Every year, as tax season approaches, scammers come out of the woodwork to take advantage of American taxpayers. And this year is no different. The IRS just released its annual “Dirty Dozen” list of tax scams that includes some oldies but goodies (baddies?), plus new scams that are on the rise.
According to IRS Chief Executive Officer Frank J. Bisignano, “thieves continuously adjust the pitches they use to take advantage of honest taxpayers.” And the IRS points out that it’s not just individual taxpayers that need to be wary, business and tax professionals are also being targeted. So even if you consider yourself a seasoned tax pro, it pays to keep up with the latest threats.
The goal of these scams? Ultimately, it’s all about the money. Scammers may fool you into giving up personal information like your social security numbers, which can then be used for identity theft, or file fraudulent refund requests on your behalf, leaving you to clean up the mess.
Here are the twelve scams the IRS says you need to watch out for.
Fake IRS emails and texts
Just like it sounds, scammers are sending emails and texts that claim to be from the IRS. The communications are likely to use urgent-sounding language intended to scare you into clicking a link or downloading a file before you have time to consider the consequences. Doing so may take you to a phishing site designed to steal your personal information or even install malware on your computer.
If you receive a notification from the IRS that requires your response, the safest approach is to contact the IRS through one of the online or phone options listed on the IRS help page. Never call any phone number listed in the notification, as that may simply connect you directly to the scammers.
Read more: How to tell if an email from the IRS has been spoofed
AI phone calls from fake IRS agents
It shouldn’t be a surprise that as AI tools evolve, scammers will increasingly take advantage of the capabilities to perpetuate criminal activity. The IRS reports it is seeing AI-enabled IRS phone impersonation that uses natural-language conversation and spoofed caller ID to appear to be coming from a legitimate IRS agent.
As with emails and texts, these calls may use threatening language, such as claims of arrest or large fines, to pressure you into providing information or making a payment. The goal is to create urgency, so you act before verifying whether the call is legitimate.
The IRS notes it generally contacts taxpayers by mail first and “does not leave urgent, threatening prerecorded messages, call to demand immediate payment, or threaten arrest.” If you receive a call of this nature, hang up and contact the IRS help center through the official channels listed above.
Fake charities
Seeing tragic events around us, such as natural disasters or wars, makes us want to loosen our purse strings to help those affected. And that outpouring of generosity is the perfect opportunity to open a fake charity to take advantage of good intentions.
Donating to one of these fake organizations means your money never reaches those who need it. And if you try to claim a tax deduction on that donation, you could face back taxes, interest, and penalties if the IRS disallows it. The IRS reminds taxpayers that “charitable donations only count if they go to a qualified tax-exempt organization recognized by the IRS.”
Be wary of giving to any charity based on a phone call or unsolicited mailing. Sites like Charity Navigator will help you find legitimate charities matched to your interests and understand how effectively they use donations.
Misleading tax advice on social media
Social media is filled with people offering advice on just about every topic, regardless of whether they are qualified to do so. And that holds just as true for tax guidance. The IRS warns that “social media-driven misinformation and disinformation remain a major driver of tax scams.”
Sometimes the advice is simply incorrect. In other cases, what the IRS calls “viral tax hacks” are intentionally misleading and designed to push you toward paid services, downloadable guides, or other products.
Following bad advice can have real consequences. Filing a return with false information or claiming credits you don’t qualify for can lead to delayed refunds, audits, and potentially significant civil or criminal penalties. It’s best to rely on qualified tax professionals and reputable sources, not your favorite influencer.
Identity theft involving your IRS online account
Your IRS account is a goldmine for criminals. Once a scammer gains access, they can change your direct deposit information, file or modify returns, and redirect your refund to their own account. With access to your Social Security number, income history, and employer details, they can use that information for identity theft and other financial crimes.
The weak point isn’t the IRS system – it’s the user. Criminals don’t hack the IRS directly. Instead, they rely on stolen data from breaches, phishing attacks, or tricks designed to get you to hand over login credentials or verification codes. In some cases, they may pose as “tax helpers,” offering to assist with account setup in order to collect your personal information.
The IRS recommends creating your account directly through IRS.gov and avoiding any unsolicited offers of help. It’s also important to use a strong, unique password. A password manager – such as 1Password, Dashlane, Apple Passwords, or Google Password Manager – can make it easier to create and manage secure logins.
Fake capital gains credit claims
This is one of the more technical scams on the IRS list. Scammers are encouraging taxpayers to claim refunds using Form 2439, which applies to undistributed long-term capital gains from certain investment funds or real estate trusts. In these schemes, the supporting information is either fabricated or significantly overstated.
The pitch is straightforward: file this form, claim a credit, and receive a larger refund. But if you don’t actually have qualifying investments, the claim is invalid. Filing a false claim can lead to delayed refunds, audits, penalties, or enforcement action.
Bogus “self-employment tax credit” promotion.
This scam is spreading rapidly online, targeting freelancers and small business owners. The messaging typically claims there is a little-known “self-employment tax credit” that can generate large refunds with minimal effort.
Scammers may offer to handle the filing for you – for a fee – or provide instructions on how to claim the credit yourself. In many cases, the credit is misrepresented or applied to taxpayers who do not actually qualify.
If you’re being told you can easily qualify for a large refund without clear eligibility requirements, that should raise concerns. The IRS says they are closely reviewing these claims, and if you file incorrectly, you are responsible for repayment, penalties, and potential audits.
Ghost tax preparers
A “ghost preparer” is someone who prepares your tax return but refuses to sign it or include their Preparer Tax Identification Number (PTIN). While that may seem like a minor technical detail, it is one of the clearest warning signs of fraud.
Dishonest ghost tax return preparers may promise a big refund to get your business. But by not signing the return, the preparer avoids accountability for any false information or fraudulent claims, leaving you legally responsible for everything filed under your name.
If your preparer won’t sign your return, won’t provide a PTIN, or pressures you to sign an incomplete return, you should walk away. A legitimate tax professional will always stand behind their work.
Non-cash charitable contribution schemes
Donating property to charity can provide a legitimate tax deduction, but scammers have found ways to exploit that system. Promoters of these schemes may push structured arrangements involving land, artwork, or conservation easements, supported by highly inflated appraisals. The sales pitch typically promises that you can dramatically reduce – or even eliminate – your taxes through these donations.
When the IRS reviews these claims, it may disallow the deduction and assess you with back taxes, interest, and penalties. If someone is promising unusually large tax savings tied to a donation, talk to your accountant first. And, it should go without saying, don’t file information you know or suspect to be false.
Overstated withholding schemes
This scheme occurs when scammers encourage individuals to report false withholding amounts on forms such as W-2s or 1099s to make it appear that more tax was paid than actually was. The goal is to generate a larger refund by claiming withholding that never occurred. In some variations, taxpayers are instructed to report little or no income while still claiming significant withholding from multiple sources.
The IRS cross-checks withholding against records from employers and financial institutions, so discrepancies are likely to be flagged. If you’re advised to manipulate withholding numbers to increase your refund, that is a clear sign of fraud. Filing this type of return can lead to delayed refunds, audits, and financial penalties.
Spear-phishing attacks targeting tax professionals
This scam is primarily aimed at tax professionals and businesses, but it can have a direct impact on taxpayers whose data is stored in those systems. Attackers send targeted emails posing as new clients or legitimate contacts, often including links or attachments designed to install malware or steal login credentials.
At Techlicious, we’ve seen examples of this type of attack disguised as DocuSign phishing attacks and malware hidden inside calendar invitations.
Once a tax professional’s system is compromised, scammers can gain access to large volumes of sensitive client information, including Social Security numbers, tax returns, and financial records. They may also impersonate your taxpayer to trick you into sending tax payments to an account under their control.
For individuals, the risk is indirect but significant. It’s important to be cautious if you receive an unexpected request for sensitive information or to make a tax payment from your accountant. And for tax professionals, maintaining robust security practices is critical to protect yourself and your clients.
Read more: I Almost Fell for This DocuSign Phishing Scam
Aggressive or misleading Offer in Compromise marketing (“OIC mills”)
The IRS provides an Offer in Compromise (OIC) program that allows eligible taxpayers to settle their tax debt for less than the full amount owed. Scammers have built entire businesses around exploiting misunderstandings about how the program works.
These “OIC mills” may promise to settle tax debt for pennies on the dollar, often in exchange for high upfront fees. And, the IRS says that, in many cases, they target taxpayers who do not actually qualify for the program.
Before paying for OIC assistance, check your eligibility using the free OIC tools available on IRS.gov. If a company says you’re eligible, but the IRS tool says you’re not, that should be a big red flag.
How to protect yourself
Scammers rely on a consistent playbook to execute their schemes: create urgency, appear legitimate, and get you to act before you think. If you get a phone call or email, see a slickly produced social media post, or even receive a message from your tax preparer, slow down and consult IRS.gov or your accountant before taking action.
If you think your tax identity has been compromised, visit IRS.gov/idtheft for steps to protect your account and recover it if access has been lost.
[Image credit: Suzanne Kantra/Techlicious via ChatGPT]
