Tax Time Tips
Guard your personal information. Identity thieves can use your Social Security number to take out loans, open credit cards or even collect your tax refund Email is vulnerable to hackers, so avoid emailing your Social Security number or other confidential information to a tax preparer or accountant. If you’re using a website to file your taxes, make sure your information is protected by looking for the lock icon on the address bar.
Beware of scammers posing as the IRS. Be wary of anyone who calls or emails you and offers to help with your taxes, demands tax payments, or claims to be with the IRS. If you get a call from someone claiming to work with a government agency, ask them for their name, identification number and contact number, then hang up and call them back. Avoid anyone who demands you make immediate payments using methods like gift cards, money orders, or wire transfers.
Watch out for tax refund thieves. Tax refund theft is a growing problem. One way to help avoid becoming a victim of this scam is to file your tax return early, before the crooks file their fake return in your name. If you receive a notice or letter from the IRS indicating that more than one tax return was filed in your name, respond immediately to the IRS employee whose contact information was provided. You will also need to fill out IRS Form 14039, Identity Theft Affidavit.
Think twice before you opt for an “instant” or “rapid” refund. Some tax preparers and banks offer a refund anticipation check (RAC). This is a paid service for taxpayers who don’t have a bank account to use for direct deposit of their refund, or don’t have the money to pay for tax preparation assistance. There’s a fee (typically about $30) to set up the RAC system. The preparer deducts that fee, their tax preparation charges and other fees from the eventual refund. After all that, there may not be much of your actual refund left.
Get your refund quickly without paying any extra charges. If you file your taxes electronically and have your refund deposited directly into an existing bank account, your refund will probably arrive in less than three weeks. If you don’t have a bank account, you can you file your taxes electronically and get a refund check in the mail, or get your refund loaded on a prepaid card you already have.
You might be entitled to a refund even if you don’t owe income taxes. Call the IRS or visit www.irs.gov/eitc to learn more and see if you qualify for an Earned Income Tax Credit (EITC). The EITC is a refundable federal income tax credit for low-income working individuals and families.
Find trustworthy help with your taxes.
There are many legitimate charities doing effective work in North Carolina and elsewhere. But unfortunately, some of the people who try to get you to give to charity may be out to scam you. They may even try to use recent events, such as natural disasters, to make their phony pleas for donations sound more believable.
If you want to give to charity, do your homework first. Read our tips on how to check out a charity and learn how it would put your donation to work before you give.
Watch out for pushy telemarketers. Telemarketers that refuse to answer your questions, offer to pick up your donation or pressure you are usually up to no good. Also, some telemarketers keep up to 90 percent of the money they collect for charities. Your money will go further if you give directly to the real charity, not to hired fundraisers.
Don’t respond to unsolicited emails and text messages asking you to give. Even if the message looks legitimate, it could be an example of phishing. The messages may include links to copycat web sites of legitimate charities to try to trick donors.
Be careful of social networking posts asking you to donate. The cause may sound worthy, but you have no way of verifying how your money would really be used.
Watch out for fake charities that sound real. Some scammers use names that are very close to the names of real charities, non-profits or even law enforcement agencies. If you want to donate, contact the real charity or organization at a website or phone number you know to be valid.
Don’t give cash. Cash gifts can be lost or stolen. For security and tax record purposes, it’s best to pay by credit card. If you pay by check, make it out to the charity itself, not the fundraiser.
Protect your personal information. Never give your credit card or bank account number to someone you don’t know who contacts you, for any reason.
Be skeptical if someone thanks you for a pledge or donation you don’t remember. If you have any doubt, check your records. Be on the alert for invoices claiming you have made a pledge when you know you haven’t.
Say no to high-pressure appeals. Legitimate fundraisers won’t push you to give on the spot.
FOR MORE INFORMATION CONTACT:
North Carolina Department of Justice
Josh Stein, Attorney General