As if tax season wasn't already stressful enough, consumers increasingly have to contend with the possibility of fraud or identity theft involving their tax return.
Tax-return fraud is a mounting problem. In 2013, according to a Government Accountability Office report released last year, the Internal Revenue Service thwarted $24.2 billion in fraudulent refunds requested — but paid out $5.8 billion.
That's before thieves filed a wave of fake returns last year, prompting Intuit to temporarily halt the transmission of all state e-file returns filed through its TurboTax product. Before hackers got their hands on more Social Security numbers through breaches, including the government's Office of Personnel Management and health insurers Anthem and Premera — and before the IRS discovered a breach last spring in its own record-keeping application that exposed the records of an estimated 334,000 taxpayers.
Scammers have whipped consumers into more of a panic, renewing efforts to steal data and cash by masquerading as IRS officials. Some scams play off the risk of fraudulent returns. Others threaten audits, fines, arrests and all manner of other dire consequences to victims who don't wire cash immediately or click through a link to confirm their personal information.
You might see official-looking seals and language in an email that have been pulled from legit IRS communiqués, or hear background noise in a voice mail meant to resemble a call center, said J.J. Thompson, co-founder and chief executive of Rook Security, an IT security firm.
"This is people trying pretty hard to be successful at this," he said.
The Treasury Inspector General for Tax Administration last week went so far as to release a list of phone numbers known to be tied to tax scam calls.
Even if you're not a victim, safeguards put in place at the federal and state level to thwart tax fraud could delay your refund or otherwise snarl your return. Last year, 36.2 percent of returns the IRS flagged for potential identity theft were legitimate returns, according to a new report from the IRS National Taxpayer Advocate. It took 18 weeks, on average, for those taxpayers to receive their refunds.