Perils of Filing Your Taxes Online and How to Avoid Them

Tax season is here! As if gathering all the documents and filling out tax forms isn’t enough to give you a headache, you’ll also need to watch out for those pesky cyber criminals while filing your taxes online.


The IRS reported that there was a steady increase in the total number of tax returns that were e-filed over the past few years. Last year, more than 117 million tax returns were e-filed. As the trend of filing taxes online continues to increase among taxpayers, cyber criminals look for lucrative and sophisticated ways to trap them and make more money.

The good news is that, even though there are some risks associated with filing your taxes online, there are ways to minimize them. Read on to learn more about some of the dangers and tips to reduce them.

Roel Schouwenberg, a principal security researcher at Kaspersky Lab, warns that fraudsters often contact individuals via email and pretend to be the IRS to extract sensitive and private information. This type of scam is called phishing.

Zoho_Books_tax_phishing* Source: Kaspersky Lab

Expert tips: The IRS warns that the agency will never send any electronic communication, including emails and text messages, requesting personal information.

Remember: If you ever receive an email from the IRS requesting you to divulge more information, do not open it, click on the links or open attachments provided in the email. Forward phishing emails to to report them to the IRS.

Another serious threat that taxpayers may face during tax time is data-stealing malware. Malware is a software designed to access a computer secretly from a remote location.  Typically, a malware is deployed on most public computers and public WiFi.

Zoho_Books_tax_malware*Source: Infoworld

Expert tips: Identity theft expert Jake Stroup warns against using public computers and public WiFi while filing taxes.

Remember: Using personal computers is the best way to file your taxes online. Ensure that your anti-virus software is up to date to protect your computer from malware.

Identity theft and fraudulent tax filing
According to the IRS, identity theft is one of the top three tax time scams of 2015. In many cases, identity thieves use the stolen information to check whether the victims have filed for a refund. If the victims haven’t filed their taxes yet, the thieves will attempt to file them and get a refund for themselves.

Zoho_Books_tax_identity_theft*Source: U.S. Government Report (Nov 2013)

Fraudulent e-filing is more prevalent than you think. Recently, thousands of Alabama, Utah and Minnesota residents’ sensitive information such as their past tax records, Social Security numbers, employment histories and much more were used to file fraudulent tax returns using TurboTax.

Expert Tip: To protect yourself from this, Kelly Phillips Erb, an attorney and a tax blogger, suggests changing online passwords for all your accounts that contain sensitive information periodically.

Remember: Don’t give personal information over the phone, mail or internet, unless it is necessary, and you trust the person requesting the information. Store all your important documents in a safe place. If you suspect that your sensitive information may have been compromised contact your online filing service provider and notify your state’s tax department.

Filing your taxes online is not entirely bad. It does have its perks – your filing process is quicker and more accurate, and you receive returns much faster. To avoid being a cyber crime victim during tax time, ensure the safety of your personal information and use your judgment while sharing it. Be on the look out for any suspicious activities in all your accounts including your email, bank accounts, and personal computers.


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