Social Media Users Beware - The Tax Man Cometh

Social networking is the latest rage among the masses, and it seems that even the Internal Revenue Service has decided to log on. Both federal and state revenue agents have reportedly been nabbing delinquent taxpayers by using Facebook, MySpace, Twitter, and other social networks. Google is also an important new tool for tracking down tax dodgers.

In one reported case, the tax man logged on to MySpace and found the location of a tax evader who had listed his new address as part of a relocation application that was sent out to all his MySpace friends. The man posted a comment that he was relocating back to his hometown for his new job. He gave the name of his new employer and boasted about the increase in salary he would be receiving. The IRS was able to log on to MySpace, and find all the information they needed to track the man down. They successfully seized his assets, bank accounts, and real property, and ultimately recovered the full amount of back taxes he owed.

The IRS has admitted to scouring social network sites to nab delinquent taxpayers and tax evaders. Taxpayers are making the IRS’s work all the easier by disclosing all their personal information online. Rather than having to go into local communities and track down family, friends, or former coworkers for information they may have about the subject of the IRS investigation, IRS agents can just log on. Agents are bound by ethics rules which prohibit them from logging on and posing as a friend of the target of their investigation, but much of the information they are looking for is posted publically by social network users.

Regardless of whether you have delinquent tax issues, it still pays to be cautious when putting your personal information out into Cyberspace. Burglars and even stalkers are now using social networking sites to find their victims. Many people use Twitter to tell all their followers what they are doing, and where they are at every moment of the day, giving thieves all the information they need to decide whom to rob and when to rob them.

Here are a few precautions to keep in mind when using social media:

• Mark your privacy settings so that only your actual friends, not even friends of friends, can view your profile and your personal information.
• Don’t disclose your location, relocation information, holiday plans, income, job status, salary, or bonuses.
• Don’t boast about your income, personal assets, or expensive vacations.
• Use caution when posting photos online that reveal your location, automobile, or home interior.

In short, guard your personal information just as you lock the doors to your home.

Blog