IRS and Utility Scams

Impersonating the IRS or utility company to steal your identity.

You owe money to the IRS and there’s a risk of being arrested?! Your power is about to be shut off for an overdue balance?! Both of these scenarios are enough to make anyone panic and take immediate action to resolve. But hold on just one minute to stop and assess these situations and think about if anything seems suspicious.

While the IRS will contact you about your taxes and payments, they will not “threaten to bring in local police, immigration officers or other law-enforcement to have you arrested for not paying. The IRS also cannot revoke your driver’s license, business licenses, or immigration status. Threats like these are common tactics scam artists use to trick victims into buying into their schemes.”

Additionally, “the IRS doesn't initiate contact with taxpayers by email, text messages or social media channels to request personal or financial information. This includes requests for PIN numbers, passwords or similar access information for credit cards, banks, or other financial accounts.” Most communications from the IRS will begin with a mailed notice or letter, and will include a “notice (CP) or letter (LTR) number on either the top or the bottom right-hand corner of your correspondence.” Virtually all communication from the IRS is verifiable and actionable through irs.gov through the correspondence numbers or by signing into your account, so it is best to start there anytime you receive communication from anyone claiming they are from the IRS.

Utility scams prey on our fear of losing access to critical services such as power or water. Scammers will say that someone is on their way to shutoff the utility unless you pay immediately, and will accept a variety of immediate, but unusual, payment methods including gift cards, cryptocurrency, or even transfers via peer-to-peer payment services like Venmo.

Here are a few tips for using these services to help keep you safe:

• Utility companies will never ask for payment by gift card or peer-to-peer services.
• Shut off notices will often be sent many days in advance, and typically multiple times, not made by phone as it’s happening. Most states have guidelines on how far in advance this must occur. NJ utility customers have the right to a written notice 10 days in advance.
• You would typically know if you forgot to pay or underpaid your utility bill and should verify this with your most recent bill or through online account before sharing any personal details or payment info with the incoming caller.

Another variation of the utility scam is to claim you’ve overpaid and tricking you into providing your account or card details for them to “refund” the overage. The best way to protect yourself from this is to avoid providing any personal information, hang up, and verify the status of your account. You can do this online or by calling the utility company directly through a verified legitimate phone number found on your bill or their website.

It is also always a good idea to file a fraud report with the FTC whenever you’re a victim.

To learn more, please visit reportfraud.ftc.gov

Additional Resources:

• Enrich Article: Identity Theft Scams You Need to Know