Scam: Thieves Deposit Stolen Refund, Want it Back - IdentityTheft.com

New Tax Scam: Thieves Deposit Stolen Refund, Then Want Money Returned

New Tax Scam: Thieves Deposit Stolen Refund, Then Want Money Returned

Tax refund thieves are becoming more brazen. The newest twist: Depositing pilfered tax refunds in the taxpayers’ bank accounts and then requesting the money be returned.

In February, the Internal Revenue Service warned that thieves are stealing client data from tax professionals, filing fraudulent tax returns, and using taxpayers’ real bank accounts to deposit the refunds. Thieves then use various tactics to reclaim the refund from the taxpayer.

To collect the funds, criminals are posing as debt collection agency officials acting on behalf of the IRS. They contact the taxpayers to say a refund was deposited in error, and they ask the taxpayers to forward the money to their collection agency.

In another scam, the taxpayer who received the erroneous refund gets an automated call with a recorded voice claiming to be with the IRS and threatens the taxpayer with criminal fraud charges, an arrest warrant and a “blacklisting” of their social security number. The recorded voice gives the taxpayer a case number and a telephone number to call to return the refund.

To combat this type of fraud, the IRS said tax professionals should step up security of sensitive client tax and financial files, and that taxpayers receiving erroneous refunds should:

• Contact their tax preparers immediately.
• Speak with their financial institutions because there may be a need to close bank accounts.

Returning an erroneous refund to the IRS

Taxpayers who receive the refunds should follow the steps outlined by Tax Topic Number 161 – Returning an Erroneous Refund. The tax topic contains full details, including mailing addresses should there be a need to return paper checks. By law, interest may accrue on erroneous refunds.

If the erroneous refund was a direct deposit:

1. Contact the Automated Clearing House (ACH) department of the bank/financial institution where the direct deposit was received and have them return the refund to the IRS.
2. Call the IRS toll-free at 800-829-1040 (individual) or 800-829-4933 (business) to explain why the direct deposit is being returned.

If the erroneous refund was a paper check and hasn’t been cashed:

1. Write “Void” in the endorsement section on the back of the check.
2. Submit the check immediately to the appropriate IRS location listed below. The location is based on the city on the bottom text line in front of the words TAX REFUND on your refund check.
3. Don’t staple, bend or paper-clip the check.
4. Include a note stating, “Return of erroneous refund check because (give a brief explanation of the reason for returning the refund check).”

IRS mailing addresses for returning paper checks

For your paper refund check, here are the IRS mailing addresses to use based on the city. These cities are located on the check’s bottom text line in front of the words TAX REFUND:

ANDOVER – Internal Revenue Service, 310 Lowell Street, Andover, MA 01810
ATLANTA – Internal Revenue Service, 4800 Buford Highway, Chamblee, GA 30341
AUSTIN – Internal Revenue Service, 3651 South Interregional Highway 35, Austin, TX 78741
BRKHAVN – Internal Revenue Service, 5000 Corporate Ct., Holtsville, NY 11742
CNCNATI – Internal Revenue Service, 201 West Rivercenter Blvd., Covington, KY 41011
FRESNO – Internal Revenue Service, 5045 East Butler Avenue, Fresno, CA 93727
KANS CY – Internal Revenue Service, 333 W. Pershing Road, Kansas City, MO 64108-4302
MEMPHIS – Internal Revenue Service, 5333 Getwell Road, Memphis, TN 38118
OGDEN – Internal Revenue Service, 1973 Rulon White Blvd., Ogden, UT 84201
PHILA – Internal Revenue Service, 2970 Market St., Philadelphia, PA 19104

If the erroneous refund was a paper check and you have cashed it:

Submit a personal check, money order, etc., immediately to the appropriate IRS location listed below.

If you no longer have access to a copy of the check, call the IRS toll-free at 800-829-1040 (individual) or 800-829-4933 (business) and explain to the IRS employee that you need information to repay a cashed refund check.

Write on your check/money order: Payment of Erroneous Refund, the tax period for which the refund was issued, and your taxpayer identification number (social security number, employer identification number or individual taxpayer identification number).

Include a brief explanation of the reason for returning the refund. Repaying an erroneous refund in this manner may result in interest due the IRS.

IRS mailing addresses for sending repayment of an erroneous refund

ANDOVER – Internal Revenue Service, 310 Lowell Street, Andover, MA 01810
ATLANTA – Internal Revenue Service, 4800 Buford Highway, Chamblee, GA 30341
AUSTIN – Internal Revenue Service, 3651 South Interregional Highway 35, Austin, TX 78741
BRKHAVN – Internal Revenue Service, 5000 Corporate Ct., Holtsville, NY 11742
CNCNATI – Internal Revenue Service, 201 West Rivercenter Blvd., Covington, KY 41011
FRESNO – Internal Revenue Service, 5045 East Butler Avenue, Fresno, CA 93727
KANS CY – Internal Revenue Service, 333 W. Pershing Road, Kansas City, MO 64108-4302
MEMPHIS – Internal Revenue Service, 5333 Getwell Road, Memphis, TN 38118
OGDEN – Internal Revenue Service, 1973 Rulon White Blvd., Ogden, UT 84201
PHILA – Internal Revenue Service, 2970 Market St., Philadelphia, PA 19104