The “Federal Student Tax”: It’s not real.
Scammers look for targets throughout the calendar year, but around this time, as students and their families prepare for the beginning of school, the “Federal Student Tax” scam seems to make the rounds.
How Do I Know I’m Being Scammed?
Let’s be very clear:
There is no such thing as a “Federal Student Tax.”
Scammers are counting on persuading you that there is.
What usually happens is this:
- Someone saying they are with the IRS will call you and claim that you need to immediately pay a “federal student tax” for yourself or your children attending school.
- They will either tell you to wire the money or ask for payment information, such as credit card or bank account numbers.
- If you don’t comply or if you hesitate at all, they will get aggressive. They might tell you that you’re committing a crime, that you’ll go to jail, that the government can sue you and repossess your things, that your credit will be ruined – anything to scare you.
- They will threaten to call the police and have you arrested.
These scammers can be very convincing.
- They may sound knowledgeable, and if you ask them questions about this fake tax, they may even give you information that sounds real. This is because they have made up facts and dates ahead of time and sound confident.
- They may already know your name or your child’s name and the school’s name. This information can be easy to find if they know where to look. It doesn’t mean that what they are saying is real.
- They may use the names of actual IRS agents or police officers so when you Google the names, something actually comes up. Names and contact information of real IRS agents may be public, and this just means the scammers have just done their research. Do not assume they are who they say they are.
- Their caller ID number may look authentic. This will be because they have technology or software that lets them change their own caller ID number.
How Can I Tell It’s a Scam?
Remember that government agencies usually have specific protocol.
The IRS would never:
- Call you out of the blue to tell you that you owe money. The real IRS would first send you a notice in the mail.
- Tell you to use a wire transfer, prepaid card, or PayPal – especially over the phone. The real IRS would mail you a notice that clearly outlines how to pay.
- Demand immediate payment as though it were urgent. The IRS usually gives taxpayers sufficient time to pay back taxes.
- Threaten to arrest or deport you, or to revoke any of your licenses if you failed to pay immediately.
- Call you and ask for social security numbers, status of your tax filings, personal or financial information. If the real IRS calls you about something, they would already have that information.
- Ask for the PINs or numbers of your credit cards or bank cards. Ever.
What Should I Do If It Happens to Me?
Hang up immediately. Don’t stay on the phone to argue or debate with them. These scammers are very clever; you might be giving them information by continuing to talk to them and not even realize it.
You can also file a complaint and report the scam to the Federal Trade Commission. Make sure you type in that it’s an “IRS telephone scam” and give as much detail as you can. You could also call the Tax Defense Network at 1-800-366-4484.
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This information is provided for general consumer educational purposes only and is not intended to provide legal, tax or investment advice.