Apple warning customers that App Store gift cards can't pay income taxes

Posted:
in iPod + iTunes + AppleTV edited June 22
Apple is now warning customers up front that iTunes gift cards, in fact, cannot be used to pay taxes as number of fraud calls ramp up.

New iTunes Gift cards
New iTunes gift cards


An all-too-common scam involves an unsuspecting mark receiving a call from a unknown number -- sometimes spoofed as the IRS. Once the call is answered, a fraudster claiming to be from the aforementioned government agency informs the subject that they have unpaid taxes and must pay the balance, lest they be arrested.

One of the ways presented to the mark to settle up is the option to pay that balance by way of iTunes gift cards. They tell the mark to go to a local store, buy an iTunes gift card, then read the number to them over the phone. Needless to say, the legitimate IRS does not accept iTunes gift cards as a form of currency.

Yet the scam has continued to be rampant and it seems it has finally been enough of a concern for Apple to take action.

Now, when a customer attempts to purchase an iTunes gift card at the Apple Store, the employee will inform the shopper that iTunes gift cards cannot be used outside iTunes or the App Store, specifically as a method of paying taxes. Customers are then asked to accept this warning on the mobile POS system carried by employees before the purchase continues.

Apple now warns customers before buying gift cards
Apple now warns customers before they buy iTunes gift cards they can't be applied toward taxes


A closer look at the iTunes gift cards themselves shows a new warning line, printed in red. "Card cannot be used for payments outside of U.S. App Store or iTunes Store, including taxes," reads the text on the gift card packaging.

In the U.S., scam phone calls have continued to be on the rise, and little has been done to curb the issue. Apple itself has implemented some sort of safety precautions within the upcoming iOS 13 update that will automatically filter supposed spam call and send them straight to voicemail, though that doesn't stop the calls from coming in the first place.

Recently, some traction has been gained in the fight against these calls. A new bi-partisan "Stop Bad Robocalls" bill has seen support in the U.S. House.
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Comments

  • Reply 1 of 32
    Right.  Everyone knows that the IRS prefers Target Gift Cards.
    /s
    zeus423williamhpscooter63chiaSpamSandwichn2itivguyCarnagewatto_cobrajony0
  • Reply 2 of 32
    bigtdsbigtds Posts: 134member
    What's amazing is people still fall for this.
    lkruppchianetroxmacseekerSpamSandwichAppleExposedanton zuykovn2itivguywatto_cobrajony0
  • Reply 3 of 32
    This happens world wide, and I wonder - how stupid must a person be to believe that their government's tax authority wants, not money, but gift cards.

    The result of nothing more than a phone call, no paperwork, nothing.
    lkruppchiaStrangeDaysanton zuykovn2itivguyCarnagewatto_cobrajony0
  • Reply 4 of 32
    lkrupplkrupp Posts: 7,311member
    This happens world wide, and I wonder - how stupid must a person be to believe that their government's tax authority wants, not money, but gift cards.

    The result of nothing more than a phone call, no paperwork, nothing.
    You don’t have to be stupid to be gullible or greedy. Hell, most people apparently believe anything they read on the internet. Then there are the conspiracy theorists who will add the entire world to their conspirators list so they can justify their nonsense. Finally, there are predators and prey. Nuff said.
    pscooter63chiaCarnagewatto_cobrajony0
  • Reply 5 of 32
    badmonkbadmonk Posts: 831member
    IMHO, the biggest risks as we get older are:

    1. Ground level falls
    2. Vascular disease
    3. Motor vehicle accidents
    4. Malignancy 
    5. Scams due to technological illiteracy 


    chiaStrangeDayswatto_cobrajony0
  • Reply 6 of 32
    williamhwilliamh Posts: 671member
    badmonk said:
    IMHO, the biggest risks as we get older are:

    1. Ground level falls
    2. Vascular disease
    3. Motor vehicle accidents
    4. Malignancy 
    5. Scams due to technological illiteracy 


    Apparently people become more trusting in old age.  I would say #5 is due more to that aging-related gullibility rather than simple technological illiteracy. 
    tokyojimuwatto_cobra
  • Reply 7 of 32
    When i read the header, i thought that the 'retail sales tax portion' of an App purchase could no longer be covered by a Gift Card (in those regions where it is separated out) - so you had use credit card, etc., to pay the 5 - 15% tax of an app purchase.
    pscooter63bigtdsanton zuykovmaltz
  • Reply 8 of 32
    FolioFolio Posts: 636member
    Yes, headline mislead me too. And Apple's reported wording on the gift card is no better, unless their objective is to confuse IRS hoaxes with sales tax on purchases.
    larryjw1STnTENDERBITSwatto_cobra
  • Reply 9 of 32
    “Why, I just happen to have an iTunes gift card that will cover that amount. Let me read you the number... 5...5...5...1...1....1...2...2...5”
    bigtdswatto_cobra
  • Reply 10 of 32
    Apple could do a lot more to prevent fraud when people use their gift cards. For a company that prides itself on security, they have left the door wide open to fraudsters.
  • Reply 11 of 32
    larryjwlarryjw Posts: 418member
    lkrupp said:
    larryjw said:
    Spelling error: It's "all-too-common" not "all-to-common”
    to-too, here-hear, there-their-they’re, so-sew, the list goes on and on. Homophones are the scourge of the English language.
    Have you seen French? Half the letters in their words don't make a sound.
    watto_cobra
  • Reply 12 of 32
    azentropy said:
    Right.  Everyone knows that the IRS prefers Target Gift Cards.
    /s
    I have been using Family dollar store gift cards. They have a deal right now 10 $1 gift cards for $20. What a deal!
    watto_cobra
  • Reply 13 of 32
    linkmanlinkman Posts: 928member
    When i read the header, i thought that the 'retail sales tax portion' of an App purchase could no longer be covered by a Gift Card (in those regions where it is separated out) - so you had use credit card, etc., to pay the 5 - 15% tax of an app purchase.
    Exactly what I was thinking. They need to make the wording more correct. We will hear of a lawsuit in 3... 2... 1...
  • Reply 14 of 32
    22july201322july2013 Posts: 814member
    Bear in mind that this card is sold in many places other than the Apple Store. I have seen these cards in the past in grocery stores, drug stores and other places. The staff at these store won't "inform the shopper that iTunes gift cards cannot be used outside iTunes or the App Store" and won't give them additional warnings on the point of sale equipment. 

    I presume the warning message on the back which says "cannot be used for... taxes" is meant primarily for people who buy this card in non-Apple stores. But when I first saw this label on the back of the card (before reading the entire article) I assumed that I couldn't use it to pay taxes on items I purchased on the iTunes or Apple App Store itself. So my reaction was "Now I gotta pull my credit card out to pay the tax on an iTunes purchase?" Does Apple really want average people thinking that? That will discourage them from buying this card and therefore discourage giving Apple cards as gifts. The average person may think "Why should I give this as a gift if it forces the person I'm giving it to to pay their own taxes. That would make me look like a cheap gift giver. No thanks." <-- I actually thought that upon first reading the back of the card, and I'm a savvy tech guy. Imagine what the average consumer would think.

    1STnTENDERBITSwatto_cobra
  • Reply 15 of 32
    That is a terribly written admonition on the back of that card.  It reads as if the Apple gift card won't cover sales taxes on purchases.  There's no context for a person to think it's related to the prevention of an IRS scam.   I seriously doubt anyone making it that far into being scammed is going to be deterred by a warning reads like that.  It would almost be less confusing to have nothing at all.
    coolfactoranton zuykovwatto_cobra
  • Reply 16 of 32
    SpamSandwichSpamSandwich Posts: 31,404member
    First rule for avoiding scammers: Never answer unknown numbers on your phone.
    watto_cobra
  • Reply 17 of 32
    lkrupp said:
    larryjw said:
    Spelling error: It's "all-too-common" not "all-to-common”
    to-too, here-hear, there-their-they’re, so-sew, the list goes on and on. Homophones are the scourge of the English language.
    Ha, try Chinese where the same word can have a ridiculous amount of meanings depending on context and tone.

    First rule for avoiding scammers: Never answer unknown numbers on your phone.
    Sometimes though your friends numbers come through as unknown. I found this when we went to fibre, any number that wasn’t also on the fibre network, i.e just about everyone I knew at the time, would show up as unknown number whereas before on the old copper network the numbers showed up correctly.
    watto_cobra
  • Reply 18 of 32
    sflocalsflocal Posts: 4,701member
    If people are that stupid to pay taxes with an iTunes card, no amount of writing will resolve it.  Sadly, our elderly population are so taken advantage by this.

    I myself don't answer most calls on my phone, but every so often when I'm bored and needing entertainment, I will take that occasional unknown call to waste their time, laugh at their empty threats and call their bluff.

    I recall a very intense IRS scam call where the Indian-accented individual threatened to send a police officer to my house and "drag me up the courthouse stairs".  He reacted rather badly when I requested he send two officers instead as one officer may have difficulty dragging my 215-pound self up those stairs and may hurt his back.  Not even a concerned citizen gets a break from the I.R.S. 
    Carnagewatto_cobra
  • Reply 19 of 32
    coolfactorcoolfactor Posts: 1,534member
    Apple could do a lot more to prevent fraud when people use their gift cards. For a company that prides itself on security, they have left the door wide open to fraudsters.

    Please, do enlighten us. We're waiting.

    It's one thing to say something can be done. It's another to actually make some valid suggestions. :smile: 

    AppleExposedStrangeDaysanton zuykovwatto_cobra
  • Reply 20 of 32
    apple ][apple ][ Posts: 8,696member
    williamh said:
    Apparently people become more trusting in old age.  I would say #5 is due more to that aging-related gullibility rather than simple technological illiteracy. 
    Maybe, but I'm lucky to not be a part of that statistic, if it's true.

    I become more untrusting for each passing day.
    watto_cobra
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