Tax Scams: 7 Common Scams the IRS Wants You to Know About

Key takeaways:

• Every year, the IRS provides a report that covers the previous year’s most pervasive tax scams, called “The Dirty Dozen.”
• The most common tax scams people should watch out for involve 1. Phishing and smishing, 2. Social media “advice,” 3. Fake tax helpers, 4. Refund check scams, 5. Fake charities, 6. OIC (offer in compromise) scams, and 7. New client spear phishing scams.
• The overarching theme of this year’s “Dirty Dozen” is a rise in tax fraud due to a number of different social media tax “tricks.”

Nobody likes tax season…well, except maybe scammers. While a variety of tax-related scams have existed for years, they constantly evolve in order to stay fresh and keep their victims out of the loop. That’s why every year the IRS provides a report they call “The Dirty Dozen,” documenting the 12 most current and pervasive scams to watch out for when it comes time to do your taxes.

Today, we’ll take a closer look at some of the most common tax scams recently reported by the IRS and other authorities, so you know how to spot them and keep yourself (and your money) safe.

1. Phishing and Smishing Tax Scams 

It’s no surprise that two of the most common scams in general are used for tax scams. If you get an email or text claiming to be from the IRS, it may be one of the following scams, especially if it’s unsolicited:

• Phishing Emails: Emails claiming to be from the IRS with some urgent or enticing claim, such as you having a tax refund to claim or criminal charges pending for tax evasion. They most often contain a link to follow to “resolve the issue,” but they are actually malicious links that steal any information you provide. Occasionally, these emails will also have phone numbers, which put you in contact with a scammer rather than an actual IRS representative.
• Smishing Texts: Scammers have added a variation to classic phishing scams known as “smishing” (SMS phishing — AKA text phishing). These scams work just like phishing, where they send the same messages and fake links, but via text instead of email.

2. Social Media Tax “Advice” Scams

Only a small portion of supposed TikTok/Twitter (now known as X) tax gurus are actually scammers trying to steal your identity or money. The rest…they’re just after views, clicks, and general engagement. By simply providing “tax hacks,” content creators can generate viral videos that lead to plenty of money via ads or sponsorships, regardless of how accurate the “advice” is.

Popular social media advice scams that the IRS has recently seen often involve the following:

• Fuel Tax Credit claims
• Self-employment tax credit claims
• Overstated withholding information

A real-life example of this is a series of viral tax videos about how to use — or rather misuse — Form W-2 and Form 8944 for some supposed benefit. While the videos talk about how you can get all kinds of credits or refunds, the reality is that you may  actually be committing tax fraud, and the IRS isn’t one to let that slide.

Just remember, “I saw it on social media” isn’t going to get you out of trouble with the IRS.

3. Fake Tax Helper Scams

Semi-related to the above scams dealing with social media, fake tax helpers have long offered tax assistance services that are just fronts to steal your money and/or identity. These scams vary in the supposed assistance they offer, but are usually one of two ploys:

1. They claim to do your taxes for you in a way that provides some extra benefit, but they are actually interested in stealing all the private information you give them. 
2. Others, known as “ghost preparers,” will actually submit fraudulent returns in your name to get big refunds and then disappear with the money while you deal with the consequences. 

The only people you should trust with your tax information are reputable professionals, as anyone offering loopholes or tricks is most likely a scammer.

4. IRS Check Scams and Tax Refund Scams

While the idea of receiving a juicy tax refund is often used by scammers, refund check scammers take it to another level. Here’s how these scams usually go:

1. You receive a fake IRS refund check in the mail.
2. The scammer will soon reach out (claiming to be from the IRS), instructing you that a mistake was made and you must send back a certain amount of money.
3. They’ll claim you will face some punishment if you don’t comply, and then try to convince you to send money via wire transfer, prepaid card, or money app.
4. The original check they sent will bounce, and any money you sent will be gone.

5. Fake Charity Scams 

Fake charities are another type of scam that frequently pops up, particularly around a tragedy or natural disaster. These fake organizations will pretend to fundraise for a good cause, when in fact they are doing what every scammer does: steal money and private personal information.

This is relevant to taxes because taxpayers who donate to charity are often able to claim a deduction on their federal tax return. The problem is that donations only count when they go to a qualified tax-exempt organization acknowledged by the IRS. That means that if you sent money to a fake charity, not only is your money gone, but so is your ability to claim it for a deduction.

6. Offer in Compromise (OIC) Tax Scam Calls

OIC (offer in compromise) scams occur through what the IRS refers to as OIC “mills.”  These “mills” are actually scammers heavily marketing fake promises of getting people out of debt through paid services. They will often call victims, claiming they can get you out of tax debt if you pay them a fee. Unfortunately, the fee is often excessive, you don’t actually get out of all your debt, and the reality is that the OIC program (which is a real program) is made so that anybody who qualifies can easily do it themselves for free.

7. New Client Spear Phishing Scams

This tax scam applies specifically to tax professionals. Spear phishing is a special type of phishing that specifically targets certain professionals, often within bigger businesses. 

Because tax professionals hold the private financial details of all their clients, they have become a featured target of spear phishing. Here, scammers will impersonate new clients, sending links that actually compromise the tax preparer’s computer system, giving the attacker access to sensitive client information.

If you’re a tax professional or work at a large business that holds valuable information, always be on the lookout for suspicious interactions and double-check links before clicking.

Tax Season Scams FAQs

How do I find a legitimate tax professional?

Look for CPAs in your area, and check with your State Board of Accounting to confirm they are licensed and qualified.

Does the IRS send emails or texts?

No. Per the IRS’s own website, “The IRS doesn’t make initial contact through email or social media channels.”

Will the IRS call you?

In certain circumstances, the IRS might call you. Per their website, “IRS agents may call to confirm an appointment or discuss items for a scheduled audit, after an initial letter or notice.”

Taxes Filed, Scams Avoided 

If you receive a suspicious call from someone claiming to be the IRS, you can use Spokeo’s Reverse Phone Lookup tool to learn more about the phone number and view any publicly available information that may be associated with it. Gathering additional context about an unknown number may help you decide whether the call seems legitimate.

Cyrus Grant is a writer from Southern California with a background in law and dispute resolution. When he isn’t writing he can be found deep-diving into the latest technology trends or simply spending time at the beach.