On August 4^th, 2009, The Internal Revenue Service once again issued a reminder to the consumers about the “phishing” emails that use the IRS name, logo and/or a copy of a web page attempting to gather consumers’ personal and financial information, which later maybe used to open new credit card accounts, run up charges on existing accounts, obtain other services and benefits in the victim’s name.

The IRS warned consumers of the latest “phishing” scams.

Form W-8BEN

The Form W-8BEN, Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding, is a legitimate form which could be found on the IRS website.  The fraudsters modify the form and email it to unsuspecting people to request detailed financial and personal information.  The modified form may include a request for bank account numbers, PIN numbers, security questions, nationality, passport number, mother’s maiden name or any other information.  The fake letter/email states that the recipient would be subjected to additional penalties and taxes if the required information is not submitted to the fax number, address or email provided.

In actuality, the Form W-8BEN is filed with a taxpayer’s financial institution and not the IRS itself.  The legitimate form W-8BEN does not request the taxpayer’s banking information, passport number or any other related information.

Making Work Pay Refund

The Fraudsters claim the email is from IRS and reference president’s Making Work Pay provision of the 2009 economic recovery plan.  The Fraudsters claim that the Making Work Pay credit is available and could be deposited directly into the taxpayer’s banking account.  The email instructs the recipients to follow a link to a fake IRS site and claim a refund by registering there.

The only legitimate way for the taxpayers to receive the Making Work Pay credit is in their paycheck.  The tax credit is a result of a tax cut and not a lump sum payment from some so-called federal fund.

Inherited Funds/Lottery Winnings/Cash Consignments

The Fraudsters claim the emails are from the U.S. Department of Treasury to notify the recipients that they will receive millions of dollars in lottery winnings, or recovered funds, or inheritance.    In order to receive the funds, the fraudsters instruct, the recipients must provide the sender with certain personal information via email.  Usually, this scam is a multi-step scheme.  The fraudsters may contact the victims later on with further instructions to pay taxes in order to get the funds.  Or the fraudsters may issue a fake check and instruct the victim to deposit that check and pay 10% for taxes.  The Department of Treasury will not get the funds, the scammers will.

Refund Scam

This “phishing” email claims that the recipient is eligible to a certain amount of tax refund.  The recipient is instructed to follow a link and fill out a special form for a tax refund.  The form requests a lot of personal and financial information including bank account number, PIN number, etc.

It is important to remember that the taxpayer is not required to fill out any special forms to receive a refund.  The tax refunds are based on the tax return which is submitted every year by April 15^th.

How Do You Spot “Phishy” Emails?

• Should you get an email claiming to be from the IRS and is requesting an unusual amount of personal and financial information such as SSN, bank account number, routing number, credit card number, PIN number and other related information,  you should get alarmed.
• Usually, such emails will contain something to “hook” the recipients with. For example, a tax refund, tax credit, lottery winnings, inheritance, etc.
• Usually these emails contain a lot of grammar mistakes or some very odd wording, because most of these of emails come from other countries and are written by non-native English speakers.
• These emails may contain threats of consequences if the recipients do not comply with the instructions.
• The links provided in the emails are very long.  The way to find out is to hover over the link and the link will be displayed in the left lower corner of the window.  The IRS website address is www.irs.gov.  This is the one and only website address for the IRS.

What Should You Do If You Receive An Email Claiming To Be From The “IRS”?

• The best thing you can do is to never open such email and simply delete it.
• Never click on any links provided for any reason.
• Never download any attachments as they may contain viruses.
• Never reply to such emails.
• Call the IRS to find out if the IRS is trying to get in touch with you. (800) 829-1040.
• The IRS set up a special mail box for reporting suspicious emails.  The email address is phishing@irs.gov
• If you believe you became a victim of ID theft, contact the Federal Trade Commission. www.ftc.gov or call (800) 438-4338.

The Consumers should always remember that:

• The IRS will never send an email requesting any personal and banking information.
• The IRS will never discuss tax matters through emails
• The IRS will send a letter addressing you by your name and already have your personal information listed on the letter.

Should you have any tax related questions, go to www.irs.gov or talk to your Accountant.  Be safe!

To learn more about latest tax related scams, please go to www.irs.gov.