Tax season is primetime for scammers. From phishing attacks to IRS impersonation, tax scams are becoming increasingly sophisticated, making it crucial for taxpayers to stay vigilant. Scammers employ numerous tactics to mislead and exploit victims, but each scam has the same end goal—tricking you out of your money or sensitive personal information that can be used to steal your identity.

Here are some of the most common scams:  

  • Phone scams (impersonating IRS agents): Scammers use spoofed numbers to pose as IRS agents, demanding immediate payment for alleged tax debts and threatening legal action if not complied with.   
  • Phishing emails and fake websites: These scams involve fraudulent emails or websites designed to steal personal information, such as Social Security numbers, bank account details, and credit card numbers.
  • Social media scams: Scammers use social media platforms to spread misinformation and lure victims into providing sensitive information.
  • SMS phishing : Similar to phishing emails, SMS phishing involves fraudulent text messages that attempt to steal personal information.  
  • Refund scams: Scammers promise inflated tax refunds or claim to expedite the refund process in exchange for upfront fees or personal information.  

Falling victim to a tax scam can have severe consequences, including financial loss, identity theft, and significant stress. Scammers can use stolen information to commit further fraud or sell it on the dark web. Additionally, victims may face legal and financial repercussions, compounding the impact of the scam. 

Scammers often rely on psychological manipulation to gain trust. They may impersonate trusted institutions like the IRS, using authoritative language and creating a sense of urgency with threats of penalties or legal action. This pressure can cause individuals to make hasty decisions, such as providing personal information or transferring money without verifying the legitimacy of the request.

To protect yourself from tax scams and phishing attacks, it's essential to be cautious and always use strong security measures. Here are a few essential tips to help keep you safe:

  • File your tax return promptly: Filing your tax return early can reduce the risk of identity theft and fraudulent tax returns being filed in your name.  
  • Be cautious of unsolicited communication: The IRS will never initiate contact with taxpayers via email, text message, or social media to request personal or financial information.   
  • Verify the sender: If you receive an unexpected communication from the IRS, verify its authenticity by contacting the IRS directly using the official IRS website or phone number.
  • Protect your personal information: Avoid sharing sensitive information with anyone who contacts you unsolicited, even if they claim to be from a government agency.
  • Use strong passwords: Protect your online accounts with complex and unique passwords to prevent unauthorized access.
  • Beware of phishing attempts: Be cautious of suspicious emails, links, or attachments, and avoid clicking on unfamiliar links or downloading attachments from unknown sources.
  • Monitor your accounts: Regularly review your bank and credit card statements for any unauthorized activity.
  • Consider identity theft protection: Explore identity theft protection services to safeguard your personal information.

If you suspect you've fallen victim to a tax scam, act quickly to mitigate potential damage. Report the incident to the IRS and local law enforcement and consider freezing your credit to prevent identity theft. Monitor your financial accounts closely and alert your financial institution if you notice any suspicious activity. If you believe you've fallen victim to a tax scam, take the following steps:

  • Contact the IRS: Report the scam to the IRS and provide as much information as possible about the incident. You can find complete information on the IRS website.
  • Report the scam: Notify both the Federal Trade Commission as well as the Treasury Inspector General (TIGTA) using the appropriate link on their website.
  • Contact your financial institutions: Notify your financial institutions and credit card companies (if applicable) of the fraud and place fraud alerts on your accounts.
  • Monitor your credit report: Check your credit report for signs of identity theft. It’s highly recommended that you freeze your credit reports to prevent any fraudulent accounts being opened in your name. Visit the three credit bureaus (Equifax, Experian, TransUnion) to freeze your reports.

The IRS offers resources to help taxpayers stay informed about tax scams. Their website includes information on common scams, tips for protecting yourself, and instructions for reporting suspected fraud. Staying informed can help you recognize and respond to potential threats.