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Latest IRS Scams: How to Spot Them and Fight Back

Scammers are especially active during tax filing season, but it pays to be vigilant year-round.
Tina Orem
Sabrina Parys
By Sabrina Parys and  Tina Orem 
Updated
Edited by Chris Hutchison

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IRS scams involve criminals impersonating IRS agents, other government employees or debt collectors in an effort to trick you into sending them money for taxes, penalties or fees you don't actually owe. Typically, these scams play out over the phone, text, online, or via the mail.

Here’s a list of recent IRS scams, tips on how to spot one and where to report fraudulent activity.

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The latest IRS scams

1. 'Unclaimed refund' scam

Picture this: The doorbell rings, a delivery person appears, and you're quickly handed a cardboard envelope. Inside the mailer is an official-looking letter from the IRS, telling you that you're entitled to a refund. To collect it, you'll just need to email a picture of your driver's license and confirm your Social Security number with an IRS agent.

If a sudden tax windfall feels too good to be true, that's because it is, says the IRS. The fraudulent notice — often labeled "in relation to your unclaimed refund" — targets taxpayers at home to steal sensitive information that could be used for tax fraud or identity theft. Although the letter may seem official, the agency warns of several signs that should raise red flags, including incorrect agency phone numbers and addresses, improper punctuation, strange fonts, and outdated or wrong tax information

.

» Curious about your refund's whereabouts? How to track the status of your tax refund

2. Employee retention credit scam

Heads up, business owners: The IRS has been monitoring a wave of tactics used by scammers to promote and misrepresent the employee retention credit (ERC), a pandemic-era tax break for qualified businesses. Fraudsters have been encouraging businesses that do not qualify to apply for the tax credit to either steal tax information or make money by charging a large fee for application assistance.

In fact, the ERC scams have grown so rampant that the IRS set up an ERC withdrawal program so that people who think they might have submitted a fraudulent claim can retract their paperwork without penalty or interest. The agency also set up another temporary program to allow businesses that improperly received a refund from claiming the credit to pay a portion of it back

.

If you've encountered or been approached by a scammer, you can report them to the IRS by filling out Form 14242 and sending it to the IRS Lead Development Center in the Office of Promoter Investigations

Internal Revenue Service. Abusive Trust Tax Evasion Schemes - Referrals - Contacts. Accessed Mar 11, 2024.
.

3. Fake W-2 scam

Submitting false information to the IRS could land you in serious trouble. An honest mistake, such as a typo or forgetting to include income from a stray 1099, can be remedied, but falsifying information or altogether making numbers up in hopes of getting a larger-than-life refund is a big no-no. The agency could hit you with substantial penalties, including a $5,000 fine or even criminal charges

.

Taxpayers who encounter social media scams encouraging them to input false information, incorrectly claim credits they do not qualify for, or claim household employees who do not exist should understand that these too-good-to-be-true schemes are exactly that. And remember, the IRS also gets a copy of your W-2 from your employer, so it can easily check what you submit against what your employer turned in.

4. Donation and charity scams

Generosity can go a long way on your taxes: Itemizers are generally able to write off a certain amount of charitable contributions or donations as deductible expenses. The key to taking advantage of this deduction properly? Make sure the organization you're donating to is an IRS-recognized charity — and take extra steps to confirm so.

The IRS warns taxpayers that fake charities often employ tactics such as pressuring people into making payments quickly or asking for donations in gift cards or through bank wire. The best way to ensure that your money is going exactly where it should be is to check the IRS' TEOS tool to confirm the organization's tax-exempt status

Internal Revenue Service. IRS: Beware Of Fake Charities; Check Before Donating. Accessed Mar 11, 2024.
.

5. Recalculated refund scam

These scam emails display the IRS logo and use subject lines such as "Tax Refund Payment" or "Recalculation of your tax refund payment." It asks people to click a link and provide their Social Security number, birthday, address, driver's license number and other personal information in order to submit a fake form to allegedly claim their refund. These scammers may also sometimes use a ".edu" email address to target college students

.

6. IRS account sign-up scam

Setting up an online account with the IRS can get you access to valuable information, such as your payment history or a tax transcript. You can even sign up for and/or manage an IRS payment plan through the system. The agency warns taxpayers to be especially wary of anyone who attempts to help them set up an account, though. Scammers may be attempting to steal sensitive information — such as Social Security numbers, tax identification numbers or photo IDs — under the guise of helpfulness. You can set up an online IRS account by yourself for free on the agency's website, and if you require assistance, work directly with the IRS

.

7. Casualty loss scams

Victims of natural disasters can be prime targets for scammers looking to get their hands on sensitive information such as a Social Security number or other financial records. Scammers may call, email or reach out via social media, posing as fake charities or even claiming to be IRS agents who can help file a casualty loss claim. The agency urges taxpayers to ignore all unsolicited contact and instead call the IRS' disaster assistance line (866-562-5227) for official information about disaster-related tax help

Internal Revenue Service. How To Avoid Fraud and Scams After A Disaster. Accessed Mar 11, 2024.
.

8. Identity theft scam

In this trick, a criminal calls the victim and poses as an IRS agent. The criminal claims the victim's identity has been stolen and that it was used to open fake bank accounts. The caller then tells the taxpayer to go buy certain gift cards. Later, the caller gets back in touch and asks for the gift card access numbers

. Also, the IRS will never deal in gift cards, so being asked to pay for your taxes — or do anything tax-related — with a gift card is an automatic red flag.

9. Ghost tax preparer scams

Anyone you pay to prepare your tax return must have a valid preparer tax identification number and must sign your tax return. Reluctance to sign your return is a red flag that the person is a "ghost preparer" — someone who just wants to charge you a fee and then leave you hanging.

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10 ways to spot IRS scams and impersonators

It is true that in rare circumstances the IRS will come to a home or business. But the agency's new policy of scaling back on unannounced visits makes the likelihood of this extremely low

. Unless you're being subpoenaed, served a summons, or your assets are in danger of being seized, the IRS generally won't show up on your doorstep.

And, in accordance with the new policy, if a face-to-face meeting is necessary, taxpayers will receive mailed letters or notices from the agency to schedule the meet-up first. Some other major red flags that can help tip you off to an IRS scam include:

  1. They’re calling you first. The IRS contacts taxpayers by mail first; it doesn’t initiate contact via a random phone call.

  2. They’re leaving a prerecorded voicemail. The IRS doesn’t leave prerecorded, urgent or threatening voicemails.

  3. They’re emailing you. The IRS doesn't initiate contact with taxpayers by email to request personal or financial information. Do not reply to the message, open any attachments or click on any links. And note that the IRS’ website is IRS.gov — not IRS.com, IRS.net, IRS.org or some other bit after the period.

  4. They’re texting you. The IRS doesn't initiate contact with taxpayers by text message to request personal or financial information.

  5. They’re contacting you via social media. The IRS doesn't initiate contact with taxpayers on social media channels to request personal or financial information.

  6. The form they’re sending or referencing doesn’t appear on the IRS website. You can look up the names of IRS notices and letters on the IRS website. If the type of notice you received doesn’t show up on the list, it’s probably not legit.

  7. They don’t know what an HSPD-12 card is. Real IRS agents have two forms of identification: a pocket commission and an HSPD-12 card. You have the right to see these credentials, and you can verify information on the HSPD-12 card by calling the IRS.

  8. They’re asking for a credit card or debit card number over the phone. The IRS doesn’t do that.

  9. They want you to pay only with gift cards or prepaid debit cards. The IRS doesn’t use these methods for tax payments. The IRS mails paper bills to taxpayers who owe taxes, and payment should only ever be made out to the U.S. Treasury — not a collections agency or other entity.

  10. They’re saying you’ll be arrested, deported, have your driver’s license revoked, etc. The IRS can’t revoke your driver’s license, business licenses or immigration status. They also cannot threaten to immediately bring in local law enforcement. In addition, the IRS and the Taxpayer Bill of Rights give you the opportunity to question or appeal what the IRS says you owe.

But what if I really do owe the IRS money?

If you think you might owe money to the IRS, you can check that directly with the agency (for free) by visiting https://www.irs.gov/payments/view-your-tax-account. If you do owe back taxes and want to make a payment, you can send money directly to the IRS or sign up for an installment plan to pay the IRS over time.

Also be wary of what the IRS calls "OIC mills," or offer-in-compromise mills. These companies may advertise to people who do not qualify for the OIC program, claiming that they can resolve a tax debt for little to no cost or that you need to contract their services immediately in order to settle with the IRS. If you think you may qualify for a relief program, such as an offer in compromise, visit the IRS website directly and use its pre-qualifier tool to assess your eligibility

Internal Revenue Service. Offer In Compromise Pre-Qualifier Print. Accessed Mar 23, 2023.
.

How to report IRS scams

  • Tell the Treasury Inspector General for Tax Administration (TIGTA). You can report IRS scams online or by calling TIGTA at 1-800-366-4484.

  • Forward email messages or phone numbers that claim to be from the IRS to [email protected]. Do not open the attachments or click on any links in those emails.

  • Tell the Federal Trade Commission via the FTC Complaint Assistant on FTC.gov. Add "IRS Telephone Scam" in the notes.

  • Report Social Security Administration phone impostor scams using the form on the Social Security Administration's website.

  • If the IRS scams appear to be impersonating a state tax authority rather than the IRS, contact your state attorney general’s office.

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