By Wyatte Grantham-Philips
New York (AP) – There’s a lot of information (and money) on the table during tax season. It will also become prime time for fraud.
All year round, scammers may use a handful of common tactics to try to steal your identity, money, or other sensitive information. Experts emphasize that it is important to be even more vigilant when preparing your annual tax return by April 15th.
This year, fraudsters may take advantage of the uncertainty stemming from recent workforce cuts affecting the employment of thousands of people in the U.S. Internal Revenue Service. These layoffs and potential for wider reductions raise questions about resources including IRS bandwidth in response to consumer-reported fraud.
Here are some things you need to know about tax fraud and how to stay safe:
Identify signs of tax fraud
Tax scammers may try to contact you in a variety of ways, from an appearance email, text, or phone call impersonating the IRS to unsolicited social media offers that promise a suspiciously high refund. However, there are some common red flags to keep an eye on, including:
– Emergency
– Isolation tactics or threats
– Big payday promise
– Suspicious website links
Cybersecurity experts emphasize that scammers prey on emotions, often trying to incite fear and uncertainty. Many tax frauds ask you to act quickly or click on a malicious link immediately. Others will make you think you did something wrong and go until you threaten arrest if you don’t respond. Scammers can also quarantine you from contacting others, such as trusted accounting professionals and family members.
Many tax scams also advertise big payments, but there are prices. For example, some “ghost” creators will be charged for preparing their tax returns. In many cases, we promise to maximize your refund, but do not sign it. They can then submit fraudulent returns in your name, make inflated income or fake deductions to promote a refund, and switch the listed bank accounts to charge your money.
The IRS will not initiate contacts via email, text, or social media requesting your personal information. It also encourages consumers to use only trusted, certified tax professionals if they need to prepare for a return. We recommend that those who have become victims of fraud also report it. You can find more details on the agency’s official website.
What’s the difference this year?
Tax fraud is even more convincing if you meet at the moment. And this year, experts warn that cybercriminals or “social engineers” could particularly exploit uncertainty around IRS cuts.
“Uncertainty is probably one of the biggest emotions that social engineers use,” says Dave Cronister, a well-known “ethical hacker” and CEO of Parameter Security.
Similar tactics have emerged during the Covid-19 pandemic and following a legitimate round of federal aid. For example, some scammers have made false claims about additional stimulus checks.
All that is needed is to trust them with “a little common knowledge” to “fine you,” explains Chronister.
Beyond the way scammers use news, cutting the IRS workforce could slow the agency’s ability to actually respond to fraud, chronister and more. As a result, malicious websites and predatory social media campaigns may not be removed promptly. Victims of fraudulent returns may have to wait longer for an answer.
“Surveying could be reduced,” said Chris Pearson, CEO of Black Cloak, a cybersecurity company. “If there are few individuals who will become proactive in a residential agency, I am an incredible treasure trove of data and information.
Requested for comment, the IRS pointed to a list of “dirty dozens” of common tax frauds to watch out for this year. Taxpayers can take it to protect themselves from identity theft and fraud. However, the agency did not immediately comment on whether recent workforce cuts would affect enforcement resources.
Scams have become more refined these days thanks to the increasing adoption of generative artificial intelligence. Experts warn that the technology is being used, creating “surreal” phishing messages such as video and audio deepfakes, allowing scammers to target more people at once through automation.
Pierson also warns of fallout from a recent famous data breaches. This is reportedly made headlines last year as it reportedly leaked a huge amount of confidential information on the dark web, including your full name, Social Security number, contact information, and mailing address. Putting that information there could lead to more fraudulent applications, he explains “confidence fraud.” Cybercriminals share one piece of information, like addresses, to help people trust and share more.
How can I protect my information and money?
File as soon as possible.
No one is eager to sit down and pay taxes, but keep it out of the way early – and before the scammer tries to submit something to your name, Chronister explains, it makes a huge difference. He adds that taxpayers can play it safely by sticking to what they know.
“If you’re always using Turbotax, use Turbotax. If you’re always using an accountant, use an accountant,” says Chronister. He also points out that you should password protect past filings downloaded to your device and keep your information safe by using a VPN over published Wi-Fi.
The IRS also suggests setting identity protection pins. This is a six-digit number that will help protect you from someone else in your name. You can also freeze your credits. This is recommended as an additional line of defense against future identity theft and fraud, even if it is not fraudulent. Freezing your credits will prevent new credit accounts from being created in your name. You can also temporarily “freeze” whenever you need a check to rent an apartment or apply for a loan. Credit Freezes can be set up through three national credit bureaus: Equifax, Experian and Transunion.
And again, don’t forget that the IRS does not contact you randomly via email, text, or phone. If you are in doubt, please contact us directly by visiting the official IRS website.
Avoiding fraud can also be paused before clicking or being based on something. “I take a breath, count it to ten, then say, “Okay… isn’t this true?” ” “Is my gut telling me something?”
Chronister adds that social engineering is about emotions rather than intelligence, and anyone can fall into it.
“It’s the humans who fall into these (deception),” he said. “They have been here since the beginning of humanity… so you have to stay vigilant, but don’t panic. Just keep checking your gut.”
Original issue: March 24th, 2025, 5:23pm EDT
