IRS’s 2021 ‘Dirty Dozen’ details top scams

From CFO Daily News: It’s that time again. IRS is warning business leaders and individuals about the top scams to look out for right now.

This year, though, the Service did things a little differently. It separated the typical “Dirty Dozen” into four categories:

  1. pandemic-related scams
  2. personal information cons
  3. ruses focusing on unsuspecting victims, and
  4. schemes that persuade taxpayers into unscrupulous actions.

Here’s a look at some of the top scams that could impact Finance, so your team can stay sharp and avoid losses:

Pandemic-related schemes

The uncertainty and chaos of COVID-19 provided new opportunities for scammers to dupe unsuspecting companies and individuals just trying to get by. Two scams in this category are:

  • Economic Impact Payment theft: Business aside, you always want to be looking out for your employees’ best interest. So, it may be a good idea to remind employees that they’ll typically get payments automatically from IRS. They should be wary of text messages, phone calls, etc., that ask about personal or financial info under the ruse of being related to Economic Impact Payments.
  • Unemployment fraud involving inaccurate 1099-Gs: We told you about this new, clever scheme a few months ago. Essentially, scammers file fraudulent claims for unemployment compensation using stolen personal info. Everyone should be on the lookout for 1099-Gs reporting unemployment compensation that wasn’t received.
Information cons

For Finance, some of the top scams you see time and again involve fraudsters trying to dupe you into revealing private information or transferring funds. So, it’s no surprise these made IRS’s annual list:

  • Phishing scams: IRS detailed “a continuing surge” of fake emails, texts, websites and similar attempts. Though your staff should be especially vigilant during tax season, you know they take place all year.
  • Impersonator phone calls: This scam, aka “vishing,” uses a more personal phone call to try to trick people. And let your staff know: Vishing scams were up 14% in 2020.
  • Social media scams: Social media gives fraudsters insight into employees’ personal lives and information – which they could use against them. Sometimes, fraudsters will send a link (a malicious one, that is) that they think is of interest to a recipient to ensure they’ll click it.
  • Ransomware: These scams can set your company back big time. It’s worth reiterating how careful staffers need to be when it comes to clicking links, visiting websites, etc.
Unsuspecting victims and unscrupulous actions

Though the Service’s last two categories focus more on “unsuspecting victims” (not your well-trained finance team), it’s still good for your staff to be in the know and keep everyone you work with safe. Three scams to be aware of are:

  • Fake charities: Some may try to take advantage of your company’s goodwill or generosity by setting up fake organizations. Getting the charity’s exact name, web address, etc., should help your team sniff out any scammers.
  • Unscrupulous tax return preparers: Finance knows firsthand how painstaking tax returns can be! But not everyone is as above-board as your team. Your company and employees should be wary of preparers with suspicious practices (e.g., not signing tax returns they prepare, requiring cash payments with no receipts).

Note: You can visit IRS’s Dirty Dozen web page for a breakdown of the four categories and more detailed descriptions of each scam.

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