Protecting Yourself from the Perils of Tax Season
As tax season is upon us, there are a number of issues that continue to plague the process year after year. During this time, filing taxes can be very frustrating and complex. Knowing the main obstacles, how to deal with them, how to protect yourself, and what to expect is key. With the list of issues growing, these have proven to be the ones that have caused the most contention year after year:
- ID Theft
Identity theft is so prevalent among tax filers that the IRS has resorted to providing identity pin numbers to make sure tax filers do not have their taxes stolen. For years, this has been a major problem that the IRS has not been able to control.
- IRS Phone Wait Times
In 2015, the IRS wait time was horrendous, with fewer than half the calls received being answered. The Taxpayer Advocate Service reported that 37 percent of the calls made to the IRS from January through April 2015, were actually answered with an average wait time of 23 minutes. For 2016, the IRS is predicting shorter phone waits due to the approval of a $290 million budget increase for taxpayer assistance from Congress. This should help alleviate the switchboard from automatically disconnecting due to being overloaded.
- IRS Phone Scams
The IRS started tax season with a warning—don't fall into the trap of scammers attempting to get money. There are a few scams going on, including threatening voices demanding money while claiming to be from the IRS. The agency is advising people to hang up the phone when this happens. This has been a huge problem, as at least 5,000 victims have paid out over $26.5 million dollars. Taxpayers need to know that if you owe the IRS money, they will contact you via mail.
- Tax Software Hacks
TaxAct software developer recently disclosed a data breach, with the company suspending the accounts of over 9,000 customers. The Wall Street Journal reports that information from over 450 customers have experienced a data breach occurring between October and December of 2015. As a result, the IRS has been working with vendors of tax software on improving the security and providing safeguards against identity theft.
These are just a few of the issues that plague taxpayers during this time of year. The IRS has implemented new procedures to help prevent fraud, along with new password standards, timed lockouts and three security questions to verify identity. With these protocols in place, this may help alleviate security issues taxpayers experience every year. Taking precautions to avoid these scenarios, like checking the status of your refund online, keeping your social security number safe, asking the IRS for a PIN even if you have not been hacked, and avoiding the use of tax software can make a difference. If someone calls you and demands money claiming to be from the IRS, hang up and report them immediately. All these tips should assist in making tax season a little less of a headache.