Ask The California Employment Tax And Payroll Tax Attorney – IRS Warns Against Holiday And Identity Theft Scams

By Robert S. Schriebman 2020

Introduction

For many of us the year 2020 could have been kinder. To compound all the negative energy, tax and identity theft schemes are on the rise and on the IRS’ radar. On December 1, 2020 the IRS issued press information release IR-2020-265 to warn tax professionals and taxpayers in general of increased activities in identity theft and other scams. The FBI has issued warnings about fraud and scams related to COVID-19 schemes anti-body testing, healthcare fraud, and cryptocurrency fraud. The FTC has also issued alerts about fraudulent emails claiming to be from the Centers for Disease Control or the World Health Organization. The bad guys never sleep! The IRS is concerned about schemes involving holiday shopping, the approaching tax season and coronavirus concerns. To these ends, the IRS has issued a list of precautions which taxpayers and tax professionals should seriously take into consideration. Here a few tips from the IRS:

• Do not shop on unsecure public WiFi. The IRS cautions that malls are ripe for internet predators.
• Use a password to secure in-home WiFi.
• If you are planning to shop online, only use web addresses beginning with: “https” and make sure the “padlock” icon is visible in the browser.
• Do whatever it takes to stop malware. Use an updated firewall.
• Make sure your security software is updated with the latest version.
• Go with your gut – if a link or an attachment appears suspicious, don’t go there. This is where most of the fraud schemes related to the coronavirus and Economic Impact Payment have been encountered.
• Use a multi-factor authentication.
• Always back up your files on both your computer and cell phone.
• People who are working from home are particularly vulnerable. The IRS suggests creating a Virtual Private Network that will provide security for your workplace. While most companies having offsite workers have taken these precautions, independent contractors may be the most vulnerable.
  California has introduced significant legislation delineating new categories of independent contractors. The legislation began with AB-5 and was modified in September by AB-2257. In addition, Proposition 22, passed by the voters in November, created new categories of independent contractors such as delivery workers and app-drivers. These new independent contractors may not be afforded the same cyber protections work-at-home employees have. The above precautions, recommended by the IRS, are more important than ever.

Conclusion

As we move into 2021, and the 2020 tax filing season begins to ramp up, there will be more press releases from the IRS and other federal agencies that will provide updates that will protect businesses, tax preparers, and the public at large. I will keep you posted.

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Robert Schriebman has a successful practice in the Rolling Hills Estates area of Los Angeles County serving clients throughout California and the United States. He has successfully dedicated more than 40 years to helping individual taxpayers, business owners, CPAs, Enrolled Agents, and tax attorneys navigate the complicated tax systems of the federal and state governments. Mr. Schriebman is in private practice. He is not affiliated in any way with the EDD and he is not employed by the EDD or any other agency of the State of California.

Robert Schriebman has written the only 2 books ever published dealing with how California Employment Development Department (EDD) operates. See “California Tax Collection Practice and Procedures” and “California Taxation Practice and Procedure,” both published by Commerce Clearing House.

Robert Schriebman has written over 20 books including the major manual used nationally by practitioners and the IRS, “IRS Tax Collection Procedures – A Manual for Practitioners” published by Commerce Clearing House.

Robert Schriebman has written over 20 books including the major manual used nationally by practitioners and the IRS, “IRS Tax Collection Procedures – A Manual for Practitioners” published by Commerce Clearing House in addition to the only 2 books ever published dealing with how California Employment Development Department (EDD) operates. See “California Tax Collection Practice and Procedures” and “California Taxation Practice and Procedure,” both published by Commerce Clearing House.

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