Scammers abound as US tax deadline nears

The Internal Revenue Service (IRS) is warning Americans that filing their taxes with an untrusted online service could leave them vulnerable to scams. 

The IRS said in a bulletin posted to its website on Friday that it had received reports of fake tax preparation websites being used to hijack refunds as the deadline for submitting US federal tax returns approaches.

Scammers are using two increasingly popular services: online filing and direct deposit.

Similar to phishing pages that pose as banking websites, the bogus sites are designed to look like credible members of the Free File Alliance (FFA).

The FFA is a group of 19 online tax services that allow users with a gross income under $52,000 to file their federal income taxes for free.

But when a user fills out the electronic form and elects to receive a refund through direct deposit, the scammers can change the account number and proceeds to file the return through a legitimate online tax service.

The taxpayer is then told by the IRS that the application has been processed and approved, but the scammer collects any money refunded.

Such fraudulent tax sites could also leave users vulnerable to identity theft, as federal tax forms contain sensitive information such as social security numbers, wage forms and bank account details.

The IRS said that users can avoid falling prey to the scams by using only the free file services linked on the IRS Free File page. 

The deadline for filing a federal tax return is 17 April at midnight.