#United States #Identity Theft #Tempe #Tax Fraud #LifeLock

Insights into Growing Tax Fraud Risks for Americans

As tax season approaches, millions of Americans gear up for one of their largest yearly financial events: receiving their tax refunds. This crucial time often plays a pivotal role in personal finance, aiding in bill payments and savings growth. However, recent investigations by LifeLock, alongside government data, reveal a troubling spike in tax fraud incidents that are derailing the hopes of many taxpayers.

Fraud by the Numbers

In 2024 alone, the IRS flagged an astonishing $16.5 billion in tax refunds that may have been affected by identity fraud. This rampant issue has turned innocent taxpayers into victims, causing disruptions that extend far beyond the end of tax season. As revealed by LifeLock's research, a staggering 1 in 4 taxpayers has fallen victim to identity theft, with losses averaging around $8,401 per incident. Some unfortunate individuals have even reported losses soaring to $75,000, diverting funds that were meant for savings and necessary expenses.

Ian Bednowitz, General Manager at LifeLock, stressed the alarming reality of tax-related scams, especially as 23% of Americans plan to rely on AI tools like ChatGPT or Copilot for tax filing assistance. The accessibility of AI has made tax filing easier for many, but it also opens the door for cybercriminals to exploit individuals’ personal information.

The Risks of AI in Tax Filing

While artificial intelligence can streamline the tax preparation process, it also poses risks if users aren’t vigilant. Bednowitz warns that a tax return, laden with personal data, acts like a treasure map for criminals, leading to further scams beyond tax season itself. In fact, while many consumers are willing to trust AI, they may not realize the potential consequences of sharing sensitive information through these platforms. For instance, 51% of potential users feel comfortable letting AI guide their filing process, and 41% would trust AI with the actual filing.

This false sense of security can be a gateway for fraud as scammers increasingly employ AI to access personal data, leading to unauthorized refunds and identity theft.

Preparing Against Fraudulent Attacks

Even amidst these risks, it seems that many Americans are determined to take charge of their finances and protect their identities. An impressive 79% plan to put measures in place to guard against tax scams in 2026. Here are essential strategies recommended by LifeLock to safeguard against identity theft and tax-related fraud:

• - Choose Reputable Services: Always use well-known tax preparation services and software. Verify the credentials of your tax preparer to avoid scams and misuse of your personal data.
• - Be Cautious with AI: While AI can assist with tax queries and filing, limit the amount of sensitive information you communicate to these digital tools.
• - Access Official Sites: Navigate to trusted sites by typing URLs directly into your browser, rather than clicking on potentially misleading links from emails or social media.
• - Stay Skeptical: The IRS will never request immediate payment or personal details via email or social media. Always verify any communication you receive.
• - Be Proactive: Consider using Norton 360 with LifeLock, which utilizes AI to detect sophisticated scams promptly across various platforms.
• - File Early: Beat the scammers to your tax return by filing ahead of time to prevent them from submitting fraudulent claims in your name.
• - Seek Expert Guidance: If you become a victim of identity theft, LifeLock offers support through professional restoration services to help you recover more efficiently.

Conclusion

In a world increasingly dominated by digital technology, remaining vigilant about identity protection and recognizing potential threats will be crucial as tax season approaches. LifeLock's comprehensive resources on IRS tax scams could prove invaluable, helping taxpayers to safeguard their identities and recover their hard-earned money. For further details, visit LifeLock’s website to educate yourself about effective identity theft protection strategies and find peace of mind this tax season.