March 22, 2021

Tax season is upon us, and the potential of tax fraud is also on the horizon. At Riverland Bank, account security is a priority and we want to equip our customers with the fundamental information on how to protect their accounts from tax fraud and scams.

What is Tax Fraud?

Tax fraud may include identity theft, fraudulent W-2 forms, and filing of an illicit tax return with the intention to receive a refund into the account of the scammer.

With the advancement of technology, criminals have developed several ways to steal account information without an account holder noticing until they go to file their taxes. Some signs that you may be a victim of tax fraud are; learning that you have a balance due, a refund offset, more than one tax return filed, and/or collection actions taken against your account.

Here are some tips to help you avoid tax refund fraud:

1. File your tax return as soon as possible. The sooner you file, the sooner you can protect yourself from potential fraud.

2. Place a fraud alert on your credit file. You can put a credit freeze or fraud alert on your credit account if you have reason to believe that your personal information is at risk. A fraud alert requires creditors to collect additional information to verify your identity before issuing credit. A credit freeze restricts access to your credit information which requires another layer of security and makes it more difficult to open new accounts.

3. Protect your personal identifying information. Scammers may call requesting your full name and social security number. The IRS typically will not request this information but may ask you to verify if you reach out to them first.

4. Adequately vet your tax preparer. Be suspicious of preparers who guarantee a greater refund or base fees on the size of your refund. They may take faulty deductions to increase their fees which puts you at risk if the IRS audits you.

5. Actively monitor your accounts. As best practice, request a free credit report every year. Check the IRS website to see if someone has filed a tax return in your name and if so, report it immediately.

For more tips on protecting your financial information visit our Security Resources page.