The IRS has identified several new and evolving scams targeting both taxpayers and tax preparers. Here is the latest on new and/or evolving schemes aimed at tax professionals, designed to take over their computer systems or obtain their professional information.
New Tax Client Scheme
This email scheme, a form of spear phishing, involves a fraudster posing as an individual seeking tax preparation assistance. The fraudster’s goal is to trick the tax preparer into revealing sensitive information or gaining access to their computer system, which includes client data.
- Malware Attachments: The fraudster includes an attachment in the email that, once clicked, downloads malware onto the tax preparer’s computer. This malware allows the fraudster to access the system without the preparer’s knowledge.
- Phishing Links: The email may also contain a link that directs the tax preparer to a fraudulent website. The preparer might believe they need to access this site to obtain the supposed new client’s tax information. In reality, the site collects the preparer’s information, such as email and password, or loads malware onto their computer.
Although this scam is not new, it remains a significant threat. Tax professionals and their employees, especially those looking for new business, may find such fake outreach alluring. This type of scam peaks around tax season but poses a threat year-round.
Phishing Schemes Targeting EFINs, PTINs, and CAFs
Another prevalent scam involves fraudsters using phishing emails to obtain a tax preparer’s Electronic Filing Identification Number (EFIN), Preparer Tax Identification Number (PTIN), or Centralized Authorization File (CAF) number.
- Phishing Emails: These emails or texts appear to be from the IRS and instruct the tax preparer to confirm their EFIN, PTIN, or CAF number by entering the information into a form hosted on what appears to be a legitimate IRS website.
For more information on these schemes, refer to the following IRS news releases:
- IRS News Release IR-2024-05: IRS and Security Summit partners warn of a surge in “new client” scams aimed at tax professionals as the 2024 filing season approaches. This release includes an example of what a new client scam email may look like.
- IRS News Release IR-2024-183: Discusses new and evolving scams threatening tax professionals, with the Security Summit warning of trending threats that could affect businesses and clients.
Current Tax Scams Targeted at Individuals
Identity thieves continue to evolve their methods to trick individuals into giving them their personal information, such as their Social Security Number, birth date, and banking information. Here are some of the schemes occurring this year:
- Fake IRS Letters Using AI: Fraudsters are using artificial intelligence to create false IRS letters that are mailed to individuals.
- Zero Tax Program Scheme: A fraudster calls an individual, promising to wipe out their tax debt if they owe back taxes. The caller requests the individual’s Social Security Number as part of their pitch, which they then use to file identity theft returns or for other nefarious purposes.
- Social Media Scams: Fraudsters are using social media to circulate and promote inaccurate or misleading tax advice. This can involve encouraging taxpayers to create a false W-2 or claim credits for which the taxpayer is not entitled, such as the Fuel Tax Credit, Sick and Family Leave Credit, and household employment credits.
- Phishing Calls and Texts: Fraudsters are calling or texting individuals to trick them into giving their personal and financial information in exchange for false promises that the IRS has money (such as a refund) for them.
For more information on these schemes, refer to IRS News Release IR-2024-183 on the IRS website.
Other Emerging Scams and Schemes
The IRS has also seen two other emerging schemes in recent months:
- Clean Energy Tax Credit Scheme: Unscrupulous tax return preparers are misrepresenting the rules for claiming clean energy credits under the Inflation Reduction Act (IRA). These preparers use the transferability provisions for some of the clean energy credits to offset the taxpayer’s tax liability. This scheme targets individuals who file Form 1040. For more information, see IRS IRS News Release IR-2024-182.
- Fake Self-Employment Tax Credit Scheme: The IRS has issued a consumer alert about misleading tax advice circulating on social media regarding a non-existent “Self-Employment Tax Credit.” Promoters of this scheme are convincing taxpayers to claim credits for Sick and Family Leave, for which most individuals do not qualify. The IRS closely reviews these claims. For more information, see IRS News Release IR-2024-187.
Further Resources for Information on Latest Schemes and Scams
Read about the 2024 IRS Dirty Dozen Tax Scams (https://www.crosslinktax.com/customer-resources/tax-resource-center/tax-updates/irs-dirty-dozen-scams/), or for the latest information on scams and schemes that the IRS is seeing and that you should be aware of, visit the Tax Scams/Consumer Alerts page on the IRS website.
