Tax collection scams are among the most persistent cons out there. They reappear frequently, each time with a slightly different spin. The main theme is scammers posing as an Internal Revenue Service representative in the U.S. or as the Canada Revenue Agency in Canada, and attempting to coerce you into either paying up or sharing personal information.
How the Scam Works:
These scams are most often perpetrated by phone and take two basic forms. In the first version, the IRS or CRA "agent" says you owe back taxes and pressures you into paying by prepaid debit card or wire transfer. If you don’t comply, the scammer threatens you with arrest and fines. In the other version, scammers claim they are issuing tax refunds and will ask you for personal information under the guise of transferring a refund. This information can later be used for identity theft.
These imposters often go to great lengths to appear credible. The scammer may provide a fake badge number and name. Your caller ID will often indicate that the call is coming from Washington D.C. or Ottawa. In many instances, these scams are initiated with a very serious and official sounding “robocall” recording.
Tips to Spot This Scam:
To report a scam, go to BBB Scam Tracker.
To learn how to protect yourself, go to “10 Steps to Avoid Scams”.
Last Reviewed: March 7, 2017