Beware of Tax Phishing and IRS Impersonation Scams—During Tax Season and Year-Round

Updated: April 3, 2024

While we all think of tax season as sometime between February and April and try to keep any thought of taxes out of our brain the rest of the year, criminals may try to use tax payments and refunds as a hook to steal your identity and your money the whole year round. Receiving a call or email that says it is from the IRS in March or July should not lead to immediate panic or be blindly believed without some additional research or verification. Last year, the IRS identified nearly 2.4 million fraudulently filed tax returns totalling $13.8 billion due to identity theft. So, it is definitely possible that you or a family member could be targeted by one of these scammers. Read on to learn how tax impersonation and IRS phishing scams work, how to better detect them, and steps you can take to help you avoid losing your money and personal information to fraudsters.

IRS Impersonation Scams

This scam, often targeting recent immigrants and seniors, begins with a simple phone call. Out of the blue, you may get a call from someone claiming to work for the IRS or another law enforcement agency, even providing you a fake IRS badge number. They may then tell you that you owe taxes that must be paid immediately and that if you fail to do so you could be arrested, have your business or driver’s license suspended, or even be deported. The tone of this call will likely be quite confrontational and not at all pleasant. Finally, as often is the case, the imposter on the other end of the call will demand payment from you through either a pre-paid debit card, wire-transfer, or even a gift card.

A new version of this scam has surfaced in recent years, according to the IRS. In this case, a criminal would call you impersonating the Taxpayer Advocate Service (TAS), an independent organization within the IRS. Spoofing the telephone number of the TAS to fool your caller ID, these scammers will then demand your personal information, like your Social Security number or individual taxpayer number (ITIN), in order to help them steal your tax refund or tax credit.  This information could also be used later, in combination with other personal information, to help them steal your identity and possibly even more money. 

Tax-Related Phishing Schemes

Scams don’t only come through the phone. You should be diligent about all forms of communication, especially unsolicited, including text and email. Phishing emails are often realistic-looking messages that display the IRS logo or are designed to look like official communications from other government organizations, like the TAS, or a tax software companies. They are written to try and trick you into thinking you are eligible for a refund or that you need to update your IRS e-filing status.  

If you click on the link in a phishing email, you may unknowingly be sending your personal or financial information directly to the criminals via a fake website, or infecting your computer with malware that criminals can use to help them access your files or track keystrokes.

Falling for this type of scam could put you in danger for tax-related identity theft. This is where the criminal uses your stolen Social Security number to file a fraudulent tax return under your name, enters their own payment details, and claims your tax refund before you have filed. If this happens, you may not even learn about the fraud until your own tax return is rejected because the criminal had already submitted a return using their Social Security number.  To help mitigate this type of scam, it is wise to try and file your complete tax return as early as you can. 

It’s Crucial to Know How the IRS Typically Does — and Does Not — Contact Taxpayers

Perhaps one of the most important things for you to know to help you avoid these scams is that the IRS typically initiates contact with taxpayers through regular mail delivered by the United States Postal Service.

According to the IRS, its agency will not:

• Call to demand immediate payment using a specific method, such as a prepaid debit card, gift card, or wire transfer

• Threaten to bring in local police or other law enforcement

• Demand payment without providing the opportunity to question or appeal the issue

• Threaten a lawsuit

• Leave pre-recorded, urgent messages asking for a call back

• Send an unsolicited email to collect a pending refund or to update an account

• Request any sensitive information online

• Initiate contact by email, text message, or social media to request personal or financial information

•  Ask for credit or debit card numbers over the phone

Protect Yourself Before Tax Season Begins and Year-Round

The good news is that there are preventative steps you can take to help better protect yourself and your loved ones from tax-related identity theft. Download the paper, Tax-Related Identity Theft: How to Better Detect and Avoid It, to learn more about the dangers of IRS impersonation, how tax-related identity theft can impact children and dependents, and steps you can take to help protect yourself both during tax season and year-round.

1. File your return early - though it’s too late to file early this year, this step is one of the best ways to help reduce the chance that a criminal could file a return in your name before you.

2. Use an IRS Identity Protection Pin - this 6-digit number helps prevent someone else from filing a tax return using your SSN.

3. Know how the IRS typically will and will not contact you - the IRS typically contacts consumers by USPS mail and occasionally by phone or in-person visits. The IRS typically does not send you texts or emails concerning sensitive information or leave threatening voicemails.

4. Be on the lookout for other types of fraud - getting a W-2 or 1099 that you don’t recognize could mean that you might be a victim of employment-related identity theft or unemployment fraud rather than tax fraud. Look for changes to your credit report and alerts from your ID Watchdog service.

5. Help keep your devices and your identity safer - the IRS recommends that consumers follow good cybersecurity practices including avoiding banking or shopping on unsecured public Wi-Fi and keeping devices protected with up-to-date antivirus software.

What to Do if You Think You Are a Victim of an IRS Impersonator

If you suspect that you have been targeted by an IRS impersonator, the IRS provides the following advice to taxpayers:

• If you have no reason to think you owe taxes, hang up immediately and report the incident to the US Treasury Inspector General for Tax Administration (TIGTA) on their IRS Impersonation Scam Reporting page and to the FTC through their ReportFraud.ftc/gov page.

• If you are concerned you may owe taxes, review your tax account information online on the official website of the IRS, and call the number on the written billing notice, or contact the IRS at 800-829-1040.

No one is immune to identity theft and if it becomes fraud, the effect can be wide-reaching regardless of income, education, or generation. An identity protection service can help you stem the tide against the growing threats of identity fraud and help lighten the burden of monitoring and safeguarding your accounts, credit, and digital identity on your own.

Explore https://workforce.equifax.com/solutions/identity-theft-protection to learn more about how ID Watchdog from Equifax could help warn you of potential identity theft and help you better protect yourself against identity fraud.

The information provided is intended as general guidance and is not intended to convey any tax, benefits, or legal advice. For information pertaining to your company and its specific facts and needs, please consult your own tax advisor or legal counsel. Links to sources may be to third party sites. We have no control over and assume no responsibility for the content, privacy policies or practices of any third party sites or services.