How to Spot IRS Scams

While IRS scams happen year-round, they peak in the springtime as tax payers prepare their taxes and expect their tax returns. Fraudsters take advantage of the environment to scam individuals of their money and identity. The best way to prevent falling victim to scams is by being familiar with red flags, understanding how the IRS initiates legitimate contact, and how to report fraud when you’ve identified it.

Watch for these red flags to spot IRS scams

The IRS has a standard protocol for how they contact individuals, and it’s much different from how scammers initiate contact. Keep these telltale signs of a scam in mind the next time you’re contacted by someone claiming to be a representative of the IRS:

• You’re contacted by telephone, email, text, or social media. The IRS’s standard protocol for contact is to send a letter. Because scammers look for an immediate response, they choose a more instant contact method.
• The scammer is creating a sense of urgency, and they request you take action immediately to avoid a penalty, such as a large fine or arrest.
• They claim you must make a small wire transfer to access your tax return or stimulus payment. The IRS will not request a wire transfer and you don’t need to make a payment to receive due payments.
• They claim you owe federal student tax. This tax does not exist, and they often target younger individuals filing on their own for the first time who may be unaware.
• The person preparing your taxes refuses to sign your return. This kind of scam is run by a “ghost preparer” – someone who prepares your filing, obtains your signature, charges you a fee and then disappears without providing their preparer signature and filing the return. This leaves the taxpayer responsible for not having a valid, accurate tax return filed. Avoid this scam by ensuring your preparer has a valid Preparer Tax Identification Number.
• You’re contacted to help victims of natural disaster by making a donation using credit, debit or wire transfer. Scammers tend to take advantage of crises and pose as IRS representatives looking to help victims file casualty loss claims and get tax refunds. Before making donations, always verify the charity is legitimate.

How to know if it’s really the IRS trying to contact you

The IRS initiates most contacts through regular mail delivered by the United States Postal Service. While scammers rarely use this method of contact, it is possible. Therefore, if you receive an unexpected letter from the IRS, verify it’s legitimate by calling the phone number on the IRS website – not on the letter – and confirm it with a representative.

While the IRS does not initiate contact with taxpayers by email to request personal or financial information, there are special circumstances when the IRS may call or visit a home or business. These calls and visits are usually expected, but you can also call the IRS directly to verify just in case.

How to report IRS scams

If you suspect you’ve been contacted by a scammer, report it to the IRS right away.

Report all phishing scams – fraudulent emails containing malicious links – to phishing@irs.gov, and report phone calls from scammers to the Treasury Inspector General online or by phone at 1-800-366-4484. If the fraudster appears to be impersonating a state tax authority rather than the IRS, report it your state Attorney General’s office.