For the majority of individuals, the tax season involves locating paperwork, completing forms, and hoping for a refund. However, while you’re occupied with ensuring your returns are filed on time, scammers and identity thieves are actively attempting to steal your sensitive personal information.
Throughout tax season, a significant amount of valuable personal and financial information is exchanged online, providing cybercriminals with the perfect opportunity to steal your confidential data, identity, and finances. As per the IRS, nearly 300,000 instances of identity theft were reported in 2024, resulting in $5.5 billion in tax fraud. That’s why annually, the IRS publishes its list of Dirty Dozen Tax Scams. Here are some of the primary fraudulent schemes you should be cautious about during this tax season.
Primary fraudulent tactics to be wary of in 2025
- IRS Impersonation: The most prevalent form of tax fraud typically commences with a phone call, text message, or email. The scammer pretends to be from the IRS and asserts that you owe overdue taxes. They demand instant payment, using threats of arrests, revocation of business licenses, driver’s licenses, or deportation. These scams frequently target vulnerable individuals, such as seniors or immigrants, exploiting the fear and uncertainty many people experience regarding tax filings. Easily avoid falling for these scams by remembering this crucial tip – the IRS will initially reach out to you via U.S. mail only, never through phone calls, texts, or emails!
- Deceptive emails and text messages: Phishing ploys can occur through emails, text messages, or social media platforms. Scammers send messages in an attempt to deceive you into divulging sensitive information such as W-2 forms, usernames, passwords, and account specifics. They may offer substantial refunds or threaten to impose penalties. Refrain from clicking on links or opening attachments in unsolicited messages, as they could contain malicious software. You can learn about reporting suspected phishing attempts here.
- Counterfeit Tax Preparers: Ghost tax return preparers pose as tax professionals, although they lack certification. They might promise sizable or rapid refunds to gain your business. Impersonators often fill out your tax return but fail to sign it or include their IRS Preparer Tax Identification Number (PTIN), which is mandated by law. In certain cases, they merely file a counterfeit return and abscond with your funds, holding you responsible for any false information and penalties.
- Refund Fraud through Identity theft: Fraudsters leverage your stolen data to submit a fraudulent electronic tax return using your identity. They receive a refund, and you may be unaware that you’ve been targeted until your genuine return is rejected. The most effective means to prevent tax refund fraud is by filing your return promptly. If a criminal files first, the process of reclaiming your refund can be lengthy and challenging.
Indicators of tax scams you should be vigilant about
- Unsolicited communications purportedly from the IRS: The IRS will never request sensitive information or payments through email, phone calls, texts, or social media.
- Insistence on immediate payment: The IRS will never enforce immediate payments – you will always have the opportunity to contest a tax debt.
- Threats of legal repercussions or arrests: The IRS will not threaten you with legal action or deportation.
- Requests for unconventional payment modes: The IRS does not demand exclusive payment methods, including in-person payments, prepaid debit cards, or gift cards.
- Outlandish pledges of substantial refunds: If someone guarantees you an abnormally large refund, exercise caution. You could be coerced into submitting a deceitful return and find yourself accountable for any falsified claims.
Measures to safeguard yourself
- Authenticate tax preparer qualifications: Always engage a reputable tax preparer to handle your return.
- Adopt secure filing practices: Here are recommendations on securely submitting your tax return.
- Secure personal information: Treat your personal information as confidential material. Refrain from carrying your Social Security card with you and safeguard your tax records and other private data.
- Report dubious activities: Notify about any suspected tax fraud here.
- Understand how the IRS communicates: Historically, physical mail has been the preferred mode of communication for the IRS. Always verify the authenticity of any IRS correspondences.
- Install antivirus protection for safeguarding all your personal information: Webroot solutions shield against tax-related phishing schemes, and malicious software designed to seize your confidential information.
- Utilize identity protection: To defend against scammers during tax season and beyond, consider Webroot Premium and Webroot Total Protection providing comprehensive device and identity protection. A single subscription can secure your entire digital existence with dark web monitoring, prompt fraud alerts, round-the-clock customer support, and reimbursement of up to $1 million for stolen funds and other expenditure incurred due to identity theft.
- Back up your tax records: Generate digital and physical duplicates of your tax documents. Store electronic versions in an encrypted cloud storage service and retain printed copies in a secure location. Consider using Carbonite, a solution that encrypts and continuously backs up your tax documents and all other data in the cloud with unlimited storage.
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