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Tax season has begun, and it typically comes with a big uptick in tax-related scams.
There were nearly 7.8 million reports of suspicious activities in 2022, according to a recent report from the Identity Theft Tax Refund Fraud Information Sharing Mission & Analysis Center, a partnership between the IRS, companies and states.
The tax scamming is taking place during an environment of rising fraud across the nation. U.S. consumers lost more than $5.8 billion to fraud in 2021, a 70% increase from the year before, according to the Federal Trade Commission.
With online filing now the norm — the IRS said 92% of tax returns last year were filed electronically — cybersecurity is more important now than ever.
Popular tax filing platforms such as TurboTax, H&R Block and TaxAct invest in security and have to follow regulatory requirements around it. The big tax prep companies in the U.S. have to go through a compliance and audit process to be able to store data, said Nicholas Donarski, chief technology officer and co-founder of blockchain technology firm ORE System. He added this should lead tax filers to make sure they pick a reputable tax platform, and “not just the cheapest one.”
But just because tax filing platforms implement security measures doesn’t mean its users are off the hook when it comes to personal cybersecurity best practices.
“The biggest issue isn’t so much…
