Investing in real estate became less popular after the 2008 United States recession was blamed in part on a combination of subprime mortgage lenders and the housing bubble. The negative association between the recession and the real estate made the average person hesitate to invest in real estate. Now that the economy has begun stabilizing, real estate investment has again become a competitive and attractive way to gain a stable income return. Investors are able to diversify their portfolio and present their heirs with a tangible asset that is highly valued.  Unfortunately, there are those who are seeking to exploit real estate investors making it important to be aware of the new tax scam to avoid.

The Latest Tax Scam

Each year the federal government, state governments, and consumer protection organizations receive thousands of complaints regarding fraud. Adult victims of fraud in the United States lose at least one billion dollars annually on various types of fraud, and tax fraud is currently one of the fastest growing types of fraud in the country. The latest type of tax fraud targets real estate investors and is executed by scammers who contact investors offering to help them with property taxes. There are multiple ways for a scammer to obtain an investor’s personal information including checking state property records, looking at websites maintained by Realtors that list recently sold homes, and even through social media.

How the Scam Works

Once a person utilizing this latest form of a tax scam has obtained the names and mailing addresses of real estate investors, they will begin contacting them. Typically, contact is made using professional looking letters or by telephone. Once the scammer has gotten in touch with the investor, he or she will offer to reduce the property’s taxes by disputing the property assessment. Knowing that many investors own multiple properties, the person behind the scam will offer an affordable and convenient way to have several property tax assessments reduced by their company. Saving money on property taxes is something that is attractive to everyone, especially those people who own multiple properties, making property tax fraud a growing problem.

The Potential Dangers

There are several ways that this scam could hurt an unwary investor, with the least damaging scenario involving paying for a service that the company does not actually perform. However, sophisticated scam artists using this new method often find multiple ways to defraud their victims. The property owner may receive an official looking application that is supposedly necessary for property tax reductions. In reality, the form is used to obtain the investor’s social security number that may later be used for identity theft or, if the property was purchased using cash and has no mortgage, a signed certified copy of your deed. An investor may soon find him or herself fighting to prove that he or she legally owns the property. This puts one’s valuable assets in jeopardy of being stolen before they can passed down to the next generation.

Contact an Attorney 

If you are interested in protecting your assets so you can pass them along to your family, talking to an expert is a good idea. An experienced estate planning attorney MMZ Law is able to suggest safe, legal, ways to ensure your estate plan fulfills your wishes and benefits those whom you chose, and not scammers. Contact our conveniently located Claremont, California office today to schedule a consultation.




341 W. 1st St. Suite 100
Claremont, CA 91711

MARIVEL M. ZIALCITA is the founder of MMZ LAW, A Professional Corporation, where she practices in the areas of Elder Law – Medi-Cal Planning Asset Protection, Trust & Estate, Special Needs, Conservatorship, Trust Administration, & Probate. Ms. Zialcita is a frequent speaker on trust and estate matters and holds memberships in the State Bar of California, Trust and Estate Section, The San Bernardino County Bar Association, Wealth Counsel and Elder Counsel. She currently assists in the pro bono legal services program at the James L. Brulte Senior Center in Rancho Cucamonga, California. She is based in Claremont but assists clients throughout Southern California.

This information is educational information only and not legal advice.