My tax return got scammed
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  1. #1
    pmf
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    My tax return got scammed

    My wife and I filed a paper tax return to the IRS on April 15. We do the return ourselves using Turbo Tax. We dropped it off at the USPS. I watched the clerk stamp the envelope and drop it in the mail hamper. In the return was a check for $4500 that we owed on capital gains.

    This weekend a check for $8200 from H&R Block shows up in our mailbox. The check looks legit. Its a tax refund check. Kinda odd since we owed money and didn't use H&R Block. So my wife calls H&R Block. Yes, they issued us the check. Yes, our taxes were e-filed from H&R Block. The return was requested to go into a bank account, but we sent a paper check instead. My wife explains the situation and they say they'll open a case and look into it.

    So today I call the IRS. After waiting an hour on hold I get this really helpful guy. We have your return. Looks good. You're good. You e-filed it and we made the refund. You're all good. I told him that I never e-filed the return and that I owed money. He said that's the only one they have. So I asked him about my check that they cashed on April 28-th? Yes, I can see that -- we generally just cash any checks we get. So I start asking him about items on the form -- they match up exactly to what I filed, except for the capital gains. Our income, SSN, everything! So I ask him WTF do I do about this. He says to send a copy of my return with a explanation and copies of our driver's licenses. I bet they'll really look that over closely.

    So it looks to me like there's some scammers working in the IRS since my check made it in their front door and then my return evaporated. So WTF do I do? Is it worth joining one of these identity theft companies like Life Lock? I'm kind of freaked out that someone has a good bit of financial information on me.

    I'm guess that H&R Block will do nothing since they got their cut -- even though they know the bank account number of the person who did this. And judging from the clown I talked to at the IRS, they'll do nothing either. Why do I bother being honest with my taxes when I could just lie and get a $8000 refund? Not like the IRS would ever know. It's tempting to just cash the H&R Block check. God, this pisses me off.

  2. #2
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    If anyone asks, you generally just cash any checks that come in the door.

  3. #3
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    Quote Originally Posted by 10ae1203 View Post
    If anyone asks, you generally just cash any checks that come in the door.
    I guessing the IRS does not have a sense of humor about such things

  4. #4
    pmf
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    Its not an IRS check, its a check from H&R Block. IRS pays them the refund, they take a cut and send the rest to the customer. I think that's how it works.

    I wrote VOID on it.

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  6. #6
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    Don't Efile returns jump the paper queue and get dealt with relatively quickly? It might be that your paper return is working it's way through the IRS system. I know the IRS tends to be slow but it also tends to be pretty thorough. No matter. That is extremely worrying. Did you ask H&R about this electronic bank deposit info.?
    Our taxes are done by KPMG and are just insanely complicated. We've just given up trying to understand it all. I know - very bad. But maybe that will prevent the scammers??

  7. #7
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    Quote Originally Posted by Sumguy1 View Post
    Don't Efile returns jump the paper queue and get dealt with relatively quickly? It might be that your paper return is working it's way through the IRS system. I know the IRS tends to be slow but it also tends to be pretty thorough. No matter. That is extremely worrying. Did you ask H&R about this electronic bank deposit info.?
    Our taxes are done by KPMG and are just insanely complicated. We've just given up trying to understand it all. I know - very bad. But maybe that will prevent the scammers??
    Based on the article I read, I am not sure it matters how you filed. Scammers hacked the IRS website and downloaded personal data from tens of thousands of taxpayers. I would be more concerned about that data being used for other nefarious means

  8. #8
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    Quote Originally Posted by DaveG View Post
    I guessing the IRS does not have a sense of humor about such things
    At least Jimmy at the IRS loves to listen to Howard Stern while working


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    I'm suprised I haven't seen this as a big news story. I know 4 people who had the same thing happen. Maybe it's a coincidence but it's not like I talk about taxes with people so I take the fact I know 4 people to mean it's pretty wide spread.
    Pretty scary.

  10. #10
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    Quote Originally Posted by Jay Strongbow View Post
    I'm suprised I haven't seen this as a big news story. I know 4 people who had the same thing happen. Maybe it's a coincidence but it's not like I talk about taxes with people so I take the fact I know 4 people to mean it's pretty wide spread.
    Pretty scary.
    yeah... something tells me the actual number of hacked people is way bigger than the 100k that is in the news... gummint has a way of "trickle truth" in these things... later, if you pay attention to the buried story on page 34 you might see the article where the IRS admits the actual number is in the millions... maybe....
    * not actually a Rock Star

  11. #11
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    Is it possible the H&R Block person is the fraudster? I've never had them do a tax return, but surely they don't get a cut from your return. They just charge a fee to prepare the documents, as far as I am aware, and the refund check would be sent from the IRS directly to the recipient. My guess is the H&R Block check is bogus, and part of the scam.

    In any case, this is both tax fraud and mail-fraud. You need to get in contact with the US District Attorney's office.

  12. #12
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    I believe the IRS will work steadily to sort it out.
    I was due a refund one year - a bit more than a thousand dollars. I put the wrong checking account number on the form somehow - I think I am used to typing it in, but not writing by hand. I inverted two digits.
    My refund went to someone else.

    I checked the rules - technically, I was out of luck - it was me who put the acct number.

    The IRS sounded less than enthusiastic - in fact, they sounded bored.

    But they did straighten it out, and I got my refund. It took about a month.

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    Quote Originally Posted by PJay View Post
    I believe the IRS will work steadily to sort it out.
    I was due a refund one year - a bit more than a thousand dollars. I put the wrong checking account number on the form somehow - I think I am used to typing it in, but not writing by hand. I inverted two digits.
    My refund went to someone else.

    I checked the rules - technically, I was out of luck - it was me who put the acct number.

    The IRS sounded less than enthusiastic - in fact, they sounded bored.

    But they did straighten it out, and I got my refund. It took about a month.
    I always assumed on a direct deposit that they validated that the account number matched the name on the account and/or SS#. I guess I had too much faith in the process.

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    DaveG - you would think.

    Also, one year, I put the same final-four digits for both of my kids - and my return got sent back since the bad social security number for one of my kids meant I had "over" claimed deductions - I had to do some correction process.

    Like - I have the same kids every year, with the same SS#. Don't they know who I am, and who my kids are? --I guess this makes me less worried about NSA if the IRS cannot simply check my kids' SS#.

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    I'm pretty sure you'll see green screens, pocket protectors and legacy programers at the IRS. They may still be working through some of those pesky Y2K issues.

    If I worked there, I'd have a slide rule on standby. Just in case.

  16. #16
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    It looks pretty unpleasant to say the least. My sympathies.

    Credit monitoring cannot stop a criminal from opening new accounts in your name; it can merely notify you after the fact that someone has done so and you need to clean up the mess. Given that the thieves already had Social Security numbers for the accounts they cracked, victims of the hack are in for a lifetime of looking over their shoulders. Theft of this kind of information — coupled with the data from past years’ tax returns — means people are likely to feel the impact for much longer than they do when credit card numbers are stolen, as banks swiftly replace those cards.
    IRS data theft: 5 things you need to know - MarketWatch
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    AFAIK, if you mail your return with payment they tell you to send it to a lockbox address. For example mine went to San Fran. They (contracted service) pull the check and then forward the return to Fresno service center.

    I did one year send it to Fresno. Got a letter from IRS a couple months later giving me a penalty for late return. Called IRS and faxed my certified mail receipt from the 15th and they removed the penalty. Since then though I send to the lock box.

    scott s.
    .
    Last edited by scott967; 05-27-2015 at 07:10 PM.

  18. #18
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    I think you should buy a new bike. I've heard Jamis makes racy ones.

  19. #19
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    Was on the news last night. Most likely Russian Mob who has been scamming the IRS but there are heaps of cases. You should have cashed the HR Block check as clearly they didn't do enough due diligence. Oh and file electronically because you will get notified then and there if someone has jumped your SS to do so.

    Last, I pay my tax guy directly, the refund comes from the IRS directly

    Having someone middle man my refund (after taking a cut) seems creepy
    one nation, under surveillance with liberty and justice for few

    still not figgering on biggering

  20. #20
    pmf
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    Quote Originally Posted by atpjunkie View Post
    Was on the news last night. Most likely Russian Mob who has been scamming the IRS but there are heaps of cases. You should have cashed the HR Block check as clearly they didn't do enough due diligence. Oh and file electronically because you will get notified then and there if someone has jumped your SS to do so.

    Last, I pay my tax guy directly, the refund comes from the IRS directly

    Having someone middle man my refund (after taking a cut) seems creepy
    If you'd have read my post closer, you'd see that the scammer went through H&R Block. Not me. I did the return using Turbo Tax, printed it out and wrote a check for the money I owed to the IRS. I would never do the middle man thing. Not so much because it's creepy, but rather kind of lazy. But if you're some guy in Russia logging onto the H&R Block site and using their software to create a false return that generates a $8200 refund that then gets deposited into a bank account, why not? I don't know why H&R Block sent a check instead, but I'm sure glad they did because no one, including them and the IRS, would be the wiser if they hadn't.

  21. #21
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    What I find surprising is the timeline in your case: You said you sent your return by snail-mail on the 15th of April, and the bogus return that the scammers filed for you had the same data as your return (except for capital returns, or rather losses, I assume), including your income.

    Now, if we assume that your income was not exactly the same as last year, that would mean that between April 15 (well, more realistically a few days after that, taking into account the time for mail delivery) and roughly the beginning of last week (again, to account for mail delivery of the check you received), the scammers got access to these data. If we also figure that there's quite a bit of time for the IRS to process your return internally, then that leaves almost no time, or literally no time at all for the above events to happen. I thought it would typically take the IRS several weeks (at least four) to process a paper return, certainly for returns submitted on Tax Day. It would be fascinating to find out how this scam worked. I wonder whether the culprit was not the IRS, but someone in a post office opening envelopes and scanning paper returns.

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    Quote Originally Posted by atpjunkie View Post

    Last, I pay my tax guy directly, the refund comes from the IRS directly

    Having someone middle man my refund (after taking a cut) seems creepy
    That's why I suggested that that the H&R Block thing was an impostor. Maybe part of the scam is they send you a bad refund check so they can find out what your bank account number is?

    These guys are professional thieves and have likely invested a lot of thought and creativity into what they are doing.

  23. #23
    pmf
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    Quote Originally Posted by Pirx View Post
    What I find surprising is the timeline in your case: You said you sent your return by snail-mail on the 15th of April, and the bogus return that the scammers filed for you had the same data as your return (except for capital returns, or rather losses, I assume), including your income.

    Now, if we assume that your income was not exactly the same as last year, that would mean that between April 15 (well, more realistically a few days after that, taking into account the time for mail delivery) and roughly the beginning of last week (again, to account for mail delivery of the check you received), the scammers got access to these data. If we also figure that there's quite a bit of time for the IRS to process your return internally, then that leaves almost no time, or literally no time at all for the above events to happen. I thought it would typically take the IRS several weeks (at least four) to process a paper return, certainly for returns submitted on Tax Day. It would be fascinating to find out how this scam worked. I wonder whether the culprit was not the IRS, but someone in a post office opening envelopes and scanning paper returns.
    No, not losses, we took some money out of a mutual fund. When you do that you get hit with capital gains taxes. That and taxes we owed for out nanny put us about $4500 in the red.

    According to the IRS, the scammers filed the the e-return on May 12. It's the only return the IRS has on record as of yesterday. IRS cashed my check well before that (April 23). Apparently, the e-returns get processed a lot faster than paper returns. So they must open the envelope, pull out the check and throw the forms in a pile for processing. I compared with the IRS guy, over the phone, line by line on my form (I had a copy) and what the e-return had on it. Income was within a dollar. Employers submit W-2's to the IRS, so they have that information before they get your return.

    I'm thinking this is part of the breach in the IRS database that was in the news a few days ago. If we'd had no capital gains, and if we weren't also paying the taxes of an employee, we'd definitely have been owed a pretty big return. Maybe the information on the IRS database doesn't have that detail.

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    Quote Originally Posted by pmf View Post
    If you'd have read my post closer, you'd see that the scammer went through H&R Block. Not me. I did the return using Turbo Tax, printed it out and wrote a check for the money I owed to the IRS. I would never do the middle man thing. Not so much because it's creepy, but rather kind of lazy. But if you're some guy in Russia logging onto the H&R Block site and using their software to create a false return that generates a $8200 refund that then gets deposited into a bank account, why not? I don't know why H&R Block sent a check instead, but I'm sure glad they did because no one, including them and the IRS, would be the wiser if they hadn't.
    I understood that, I wasn't referring to you in but to the Block process in general. Next time you file using Turbo just efile and you'll get pinged if someone has done the fraud. The IRS doesn't accept the same return SS twice, so you know instantly.
    I use a guy because my wife used him before we were married, she has a long relationship with him. His rate is great and he always finds stuff we would have missed, so we come out ahead in the long run.
    one nation, under surveillance with liberty and justice for few

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    Quote Originally Posted by wgscott View Post
    That's why I suggested that that the H&R Block thing was an impostor. Maybe part of the scam is they send you a bad refund check so they can find out what your bank account number is?

    These guys are professional thieves and have likely invested a lot of thought and creativity into what they are doing.
    that's a very good point. It could be a form of phishing. Maybe you call a fake HR Block and they 'log onto the account' using your personal info
    one nation, under surveillance with liberty and justice for few

    still not figgering on biggering

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