Do you find it suspicious that the Internal Revenue Service would allow you to pay back taxes with iTunes gift cards? That’s because it’s not true, and is in fact a scam.
Sadly, it’s a scam that people appear to be falling for. That’s why the Treasury Department has issued a scam alert to point out that, “Any caller requesting taxpayers place funds on an iTunes gift cards or other prepaid cards to pay taxes or fees is an indicator or fraudulent activity.”
A recent “advisor insight” op-ed from CNBC draws attention to the hoax by noting an attempted scam that was tried on money editor Jim Pavia. Pavia writes that he, “played along with the IRS phone scammer who recently called me for as long as I could. However, there was no way I was able to contain my laughter when he instructed me to pay my back taxes by purchasing an iTunes gift card.”
“I did ‘offer’ to pay with my credit card, but the scammer said it was too late for that. I was instructed to immediately buy an iTunes gift card and to stay on the phone the entire time; otherwise, ‘this final chance to avoid prison will disappear and the police will soon arrive and arrest’ me.”
Such a blatant scam seems almost humorous in how brazen and clearly false it is. Unfortunately, a large number of people fall for it. According to the IRS, more than 10,000 victims have collectively paid in excess of $54 million as a result of tax phone scams since October 2013.
Unfortunately, these scams are often successful at getting money out of elderly or otherwise vulnerable individuals who are less likely to be tech savvy. Back in 2016, an almost 90-year-old grandfather was scammed out of $50,000 in iTunes vouchers by someone claiming to be their grandson, saying they had been in a serious accident.
iTunes vouchers are frequently used in these scams because they are difficult to trace once the money transfer has been made.
Just in case it needs stating again: No, the IRS will never ask that taxes are paid in the form of gift cards. Nor will it threaten to immediately call in the police in the event that you don’t pay.