In a world where scams are continually getting more sophisticated, taxpayers do not even know whether the letters they get are real or a trap. With so many stories of people falling into scams, you’re likely wondering, “How do I know if this IRS letter is fake?”
The truth is, scammers are getting more savvy at mimicking official government correspondence, and one little mistake can lead to financial troubles and the stealing of your personal information.
Knowing how to spot a fake IRS letter is more than a precaution. It’s a must when it comes to safeguarding your future.
In this blog post, we will walk you through the steps to keep yourself safe. Continue reading!
Understanding IRS Letters
The IRS letter is an official method of communication between taxpayers and the IRS that informs the taxpayers about the changes needed in a tax return and the debt they have. Besides, it can also contain additional requests for certain major information, like income verification or clarification of the data that was previously submitted.
Before we move on to assist you in finding the fake one, let’s give you a fair idea of how the IRS legitimately communicates with the letters they send. These can help you distinguish between a real IRS letter vs fake one that scammers might send. Let’s have a look →
Official Mailing Method
These IRS letters are practically always mailed through ordinary U.S. Postal Service. If you receive an email, text, or telephone call without prior correspondence via the mail, then it is most likely a scam.
Notice Number
Each IRS notice or letter has a specific notice or letter number located in the upper right-hand corner of the page (such as CP or LTR). You can search for information on the IRS website using this number and confirm the authenticity of the letter.
Clear Explanation of the Issue
Real IRS letters will indicate why they are contacting you. Common reasons include:
- The balance is due, or the amount of your payment was incorrect
- The IRS makes changes to your tax return
- They are delaying your refund processing
- There is a need for identity verification, or they need more information
Your Rights as a Taxpayer
Each letter includes information about your rights, such as disputing the issue or requesting more time. Scammers rarely provide such details.
Personal Information
The letter will include the last four digits of your Social Security number or tax ID and the applicable tax year.
What Should You Do?
- Until the issue is resolved completely, keep a copy of the written proof from the IRS.
- Always keep your tax records and payment receipts for at least seven years for future reference.
When you know what the real notice looks like, you can protect yourself from small to big scams.
How to Spot a Fake IRS Letter?
If you are confused about whether an IRS letter is real or if a new scam is ready to disturb your finances, this section is for you. Let’s have a look →
Letter About a Tax Return You Haven’t Filed Yet
You have not yet filed your taxes and the letter somehow says there is an issue with your return. This is when you can guess the red flag. Scammers think that sending such notices at the beginning of the year can fool you, as you’d be busy preparing to file your return.
No IRS Logo on the Letter
All official IRS letters include the IRS logo at the top. If the letter doesn’t have this logo and is just plain text, it’s a scam. Always look for the logo before taking the letter seriously.
Spelling or Grammar Mistakes
The IRS is very careful about how they write their letters. If you see obvious spelling mistakes, missing punctuation, or sentences that don’t make sense, it’s a clear sign that the letter is fake. The real IRS won’t send out letters with sloppy errors.
Demand for Immediate Payment
The IRS never asks you to pay immediately or uses scary language to make you rush. If a letter says you have to pay right now or threatens you with big fines, it’s not real. They always give you time to respond and explain your situation.
Unusual Payment Methods
IRS never asks for payment like prepaid debit cards, wire transfers, or through apps like PayPal. If a letter you received is asking for any of such methods, it’s definitely a fraud letter. Keep note that the IRS only asks for traditional payment methods like checks or direct deposits.
Gift Card Requests
Scammers sometimes mention paying with gift cards, such as iTunes and Walmart, which is a sign that it is fake because the IRS never asks for such payment cards.
Letter Says You’ve Won Money or a Prize
The IRS collects taxes and never offers money or gifts. So, if your letter says you have won the prize or lottery tickets, it’s fake.
Threats of Jail or Prison Time
Sometimes, when you avoid the letter, scammers choose to threaten you, saying you will go to jail if you do not pay the due amount. Know that the IRS never threatens jail time through letters. That’s just a strategy fraudsters use.
Payment Request Made to Someone Other Than the U.S. Treasury
If the letter says you have to make the payment directly to a business or a person, know that it’s fake, as the IRS only accepts payments made to the U.S. Treasury.
Requests for Personal Information
IRS asks for information like Social Security number, credit card PIN, or bank account details. But they never do it through a letter. Thus, be aware of this situation and don’t fall trap to their tricks.
Letter Comes in an Unusual or Plain Envelope
The letter you received must have the IRS logo and return address with the U.S. Department of the Treasury on it. If it does not have the proper marking, it’s not from the IRS.
IRS scam letters in the mail have been a story of many unfortunate. Some even give in and pay the sum fraudsters ask for. But, this time, do not fall trap to some of these obvious tricks. Be safe!
Also Know About → IRS Audit Reconsideration
Common Scams Involving Fake IRS Letters
Scammers are using increasingly clever tactics to create fake IRS letters. Here are five common scams you should watch out for:
1. Refund Scams
This kind of scam asserts that your refunds are being withheld because you failed to notice the deductions, entered incorrect personal information, or paid a “processing fee.”
2. Phishing Scams
Phishing scams contain harmful links and attachments that, when clicked, take out money directly from your accounts. If you ever received certified mail from the IRS with ominous links, verify their source before hitting click.
3. Expired Tax Credit Scams
These types of scams make many Americans lose money to the scammers. They claim in the letter that you have qualified for the “employment retention credit,” which is related to the COVID-19 pandemic. But, in reality, this specific program ended in the year 2023.
Stay cautious and verify any IRS communication before taking action. Don’t let scammers take advantage of you!
Also Read → What is the IRS Fresh Start Program?
How to Report a Fake IRS Letter?
Reporting fake IRS letters are necessary, as it helps the government track the crime and protect other people from it.
- You can report the file to the Treasury Inspector General for Tax Administration (TIGTA).
- Or you can just scan the fake letter and email it to the IRS at phishing@irs.gov
Taking these steps can make a big difference in fighting tax scams.
In Closing!
Protecting yourself from scammers not only saves you money, but also keeps you out of serious trouble like identity theft and legal consequences.
Know the warnings, and keep your passwords tough and safe. Change your password frequently and remember it for all the email accounts you use for matters related to the IRS.
Set the fraud alert in all the accounts, and if you find fraudulent activity, consider contacting an authority that holds a position to take action. On a good day, you can also consult a professional tax consultant for better guidance and support.
