Every year, the IRS collects about $4 trillion in taxes and gives out more than 1 trillion in refunds. That’s a lot of money changing hands. Whenever there’s a lot of cash to be had, that’s when scam artists come out of the woodwork … and this tax season is no different. Rob tells you what they’re up to, so you don’t get taken. This is Faith and Finance - biblical wisdom for your financial journey.

• Romans 13:1 is a good reminder of how Christians should deal with civil authority. It reads, “Let every person be subject to the governing authorities. For there is no authority except from God, and those that exist have been instituted by God.” Of course, being “subject to” includes paying taxes. We should always pay what we rightly owe, and we should rightly expect a refund when we’ve paid too much. Unfortunately, scammers don’t see it that way and are always on the lookout for ways to separate you from your money at tax time.
• Tax refund fraud - If scam artists gets your Social Security number, they can file a false tax return and get your refund. Actually, they often get more than a legitimate refund by claiming low income and a lot of deductions. Later, when you file, the IRS kicks back your return and you’re left with a mess to sort out. You can avoid this by getting an Identity Protection PIN from the IRS before filing. It’s a 6-digit number to verify your identity that only you and the IRS know. You can sign up for a tax PIN number at IRS.gov.
• Defraud people with fake charity scams - Scammers set up fraudulent charities that lure good-hearted people into making donations. Donors may think they can claim those contributions on their tax returns but when the IRS discovers a charity is a fake, it could set you up for an audit. To prevent this, it’s always a good idea to thoroughly check out any nonprofit organization you’re thinking about donating to. The Bible tells us we’re to be “wise as serpents.” The IRS has set up a tax-exempt organizations search tool so you can check out legitimate charities. You can find that IRS.gov as well. You also find legitimate charities at CharityNavigator.org, MinistryWatch.com and with the National Christian Foundation at NCFGiving.com.
• “Ghost tax preparers - If that sounds scary, it should. This is when a scammer claims to be a legitimate tax professional. They usually make extravagant claims about how they can get you a big refund, and people fall for it. They may file a fraudulent return and have the refund check go to them instead of the taxpayer or they’ll just charge a big fee up front. Either way, they disappear, and the taxpayer is left with a mess. To spot a ghost tax preparer. First, they won’t sign the return or include a Preparer Tax Identification Number. That, by the way, is against the law. They may also ask for a payment without providing a receipt. They often will also falsify income to get more tax credits or claim phony deductions to get a bigger refund. They’ll also sign up to have that refund direct deposited to their bank account instead of the taxpayer’s. The IRS has set up a database where you can check to see if anyone claiming to be a legitimate tax preparer is on the up and up. Again, go to IRS.gov for the “Enrolled Agent” search tool. The IRS also says you should carefully look over your return once your preparer has completed it. If you have questions, by all means ask them. And make sure you verify the routing and bank account numbers on the return to make sure any refund will go to you.
• IRS phone scams - These come in all varieties. For example, you may get a call about a tax bill you knew nothing about. The caller claims to be an IRS agent and warns that you’ll be arrested, or your Social Security benefits will be suspended if you don’t pay immediately. These scam artists can even change their Caller ID to say IRS, and they may even have all or just the last 4 digits of your Social Security number all to make the scam look legitimate. Don’t be fooled. The IRS will never contact you by phone. If you get a call like that, just hang up.

Next, Rob answers these questions at 800-525-7000 or via email at askrob@FaithFi.com:

• Is a $300,000 whole life insurance policy you purchased two years ago at age 43 a good investment if you pay a $150 monthly premium and the insurance company says it should have a cash value of $70,000 when you are age 62, and would Term Life be a better option?
• How many years do you need to keep tax returns and supporting documents?
• How should you invest $50,000 you inherited if you are age 67 and don't want to lose the principal? (Rob referred the caller to  bankrate.com, and Ally, Marcus and Capital One 360).
• Are American Gold Reserve gold coins a good idea to invest in?
• Where can you put your Ohio deferred compensation account that is losing money somewhere that it is safe and accruing interest?
• How do you start budgeting if you are newlywed? (Rob referred the caller to the FaithFi App).

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