Tax Scams Alert: How to Spot, Prevent, and Report Fraud

Tax time has arrived, and while tens of millions of Americans are gathering up their returns, thieves are prowling in the background to steal personal financial information, refund money, and identity data. Tax scams come in all forms and sizes, from fake e-mails to false telephone calls, and they can short-change innocent taxpayers thousands of dollars.

In this guide, we will assist you in recognizing, evading, and reporting tax scams so that you can safeguard yourself and your finances. Let’s break it down into simple steps.

Beware of Tax Scams

Key Points	Details
Common Tax Scams	Phishing emails, impersonation calls, refund fraud, fake tax preparers
How to Avoid Scams	Verify IRS contacts, use trusted tax preparers, protect personal info
Reporting Scams	Forward emails to phishing@irs.gov, report calls to TIGTA (1-800-366-4484)
IRS Official Website	www.irs.gov
IRS Identity Protection PIN	Protects against tax identity theft by preventing unauthorized tax returns (Get Your PIN)

Tax scams are becoming increasingly sophisticated but being aware and alert can guard you against scams. Always check IRS communications, utilize qualified tax preparers, and report activity instantly. This way, you can protect your financial security and personal data.

Understanding Tax Scams

Tax scams are fraudulent arrangements intended to steal people’s information, tax refunds, or swindling people into sending money on false pretenses. Scammers either pose as IRS agents, tax experts, or refund processors to trick vulnerable victims.

Why Are Tax Scams So Prevalent?

• Tax season is a busy time of financial transactions, therefore a best hunting ground for the thieves.
• Taxpayers are ignorant of IRS protocols and might buy scammers’ lies.
• Email (text) communication makes it simple for criminals to impersonate government officials.

Common Tax Scams and How to Avoid Them

1. Phishing Emails and Text Messages

Phishing scams involve imposter emails or text messages claiming to be from the IRS, banks, or tax preparation software companies.

Red Flags:

• Emails or texts instructing you to “verify” your personal data.
• Unsolicited links or attachments that don’t appear legitimate and may be malware.
• Grammar or spelling mistakes in messages.

How to Be Safe:

• The IRS never contacts an individual via e-mail, text, or social media.
• Don’t respond to unsolicited links or attachments from a stranger.
• Report phishing e-mails to phishing@irs.gov.

2. IRS Impersonation Calls

Taxpayers are regularly called by scammers, who present themselves as IRS representatives and demand immediate payment of “unpaid taxes.”

Red Flags:

• Arrest threats, deportation, or license revocation.
• Requests for payment through gift cards, wire transfers, or cryptocurrencies.
• High-pressure and threatening requests.

How to Stay Safe:

• The IRS will never call to make an immediate payment demand. Hang up and report the scam calls to the Treasury Inspector General for Tax Administration (TIGTA) at 1-800-366-4484.

3. Phony Tax Preparers (Ghost Preparers)

Some scammers pretend to be tax professionals to steal information or charge too much for their services.

Red Flags:

• The preparer will not sign your return (showing a “ghost preparer”).
• They guarantee huge refunds without reviewing your tax documents.
• They charge by refund percentage.

How to Stay Safe:

• Use qualified preparers who possess a Preparer Tax Identification Number (PTIN).
• Look in the IRS Directory of Federal Tax Return Preparers.
• Do not sign a blank tax return.

4. Tax Refund or Stimulus Scams

Thieves pen letters, emails, or messages stating the IRS refigured your refund and that you must confirm your information in order to receive it.

Red Flags:

• Unsolicited notices of extra refunds or stimulus checks.
• Requests for Social Security or bank account numbers.
• Phony IRS correspondence with official logos but questionable URLs or phone numbers.

How to Stay Safe:

• Confirm refund notifications on the official IRS website: www.irs.gov/refunds.
• Never provide sensitive information by email or text.

How to Protect Yourself from Tax Scams

Best Practices for Avoiding Tax Scams

1. Check IRS Contacts: The IRS never calls, texts, or emails unexpectedly. Any unsolicited request for information is a scam.
2. File Taxes Early: The earlier you file, the less chance there is for scammers to file a fake return in your name.
3. Practice Strong Security Habits: Turn on two-factor authentication in tax software and use a secure password manager.
4. Shred Financial Documents: Don’t discard tax documents without shredding them first.
5. Keep an Eye on Your Tax Data: Check your IRS account regularly at www.irs.gov/account for suspicious activity.
6. Get an Identity Protection PIN: The IRS issues Identity Protection PINs (IP PINs) to stop criminals from filing a return in your name.

How to Report Tax Scams

If You Suspect a Tax Scam, Do the Following:

1. Phishing Emails: Report them to phishing@irs.gov.
2. Phone Scams: Report to TIGTA (1-800-366-4484) and the Federal Trade Commission (FTC) at www.ftc.gov/complaint.
3. Fraudulent Tax Preparers: A complaint can be filed on IRS Form 14157
4. Identity Theft: If someone has made a fraudulent return in your name, submit IRS Form 14039 (Identity Theft Affidavit).

FAQ’s