The Treasury Inspector General for Taxpayer Administration (TIGTA) is warning taxpayers about one particular category of tax scams that has proven to be very widespread, very aggressive, and very relentless. Callers claim to be IRS employees, and they tell their intended victims that they owe taxes that must be paid immediately using a prepaid debit card or wire transfer. The fake IRS agents threaten those who refuse to pay with arrest, deportation, or loss of a business or driver’s license. The scammers have been operating in every state in the country.
Here are some practices used by the scammers that taxpayers should watch out for:
* Use of automated robocall machine.
* Caller gives fake IRS badge numbers.
* Caller knows last four digits of victim’s social security number.
* Caller ID is changed to appear as if the IRS is the caller.
* A fake IRS e-mail is sent supporting the scammer’s claims.
* Follow-up calls are made claiming to be from the police department or motor vehicle licensing office, with caller ID again supporting the claim.
If you receive one of these fake calls, complete the “IRS Impersonation Scam Form” on TIGTA’s website, or call TIGTA at 800-366-4484.
Who have you designated as beneficiaries for your insurance policies and retirement accounts? If you can’t remember, you’re not alone. But it’s worth checking. If you make the wrong decision, it could affect who inherits those assets. In some cases, it could also change the taxes your beneficiaries will pay and the value they’ll receive. Here are some key facts about beneficiary designations.
- When you designate a beneficiary for an account, you are naming the person you want to inherit that account.
- Your designation determines who will inherit the assets in the account, regardless of what your will might say. Generally, the assets will bypass probate and go straight to the person or institution you named.
- You can designate a person or group of persons, a charity, a trust, or your estate. You may also want to designate a secondary or backup beneficiary in case the primary is no longer living.
Why are they important?
- It’s important to keep beneficiary designations up to date because they determine who will inherit the assets in your accounts. Changing your will won’t change the beneficiaries.
- There can be tax implications too. With a traditional IRA, your choice of beneficiary can affect how quickly withdrawals must be made and taxes paid. That can change the value of the IRA to your beneficiary.
How do I update them?
- First, find copies of all your current designations. Contact your insurance company and plan trustees if you can’t locate the documents.
- Review them and decide what changes you’d like to make. Make an appointment to go over the changes with your tax or estate planning advisor.
- Send your updated designations to the account trustees. Make sure you receive confirmations and keep copies in your records.