Avoid IRS and Tax Phishing Scams

Freelancer Jamie S. had a great year billing-wise and was looking forward to her tax return. She diligently sent quarterly payments and like many freelancers she used Intuit’s TurboTax to prepare and file her taxes. After she received 1099 and W-2 forms from various clients she got her return ready in late February.

She wasn’t surprised when she received an email urging her to sign in to TurboTax to update her account and finish her return to receive her refund. But something seemed wrong about the email. Why would Intuit ask for her login credentials in an email? She hovered over the “Get Started” button and saw that it linked to a fake URL.

Turbotax tax phishing scam
Source: Intuit

This email was a scam trying to steal her information.

It’s tax season again and tax year 2016 saw a 400% increase in tax-related phishing scams like the one Jamie almost fell for. Here are a few best practices and common phishing scams to keep in mind as you navigate the 2017 tax filing season.

Common tax season phishing scams

  • You qualify for a refund, but you must click on a link and fill out a form to access it
  • Your credit card funds were fraudulently used by someone else, but you can recover some of the money by visiting the included website
  • You will get a tax refund if you provide your personal and financial information
  • Refund anticipation loan – it’s perfectly legal but rife with scams so be careful
  • Tax preparation fees based on a percentage of the return amount
  • Payment rejection
  • Email address change notification

Beware of urgency emails right before the April filing deadline.

Last year the IRS saw a spike in scams right before the April deadline, noting that “This is also the time of year when taxpayers may see scam emails from their tax software provider or others asking them to update online accounts.” Some thieves have even used video relay services (VRS) to try to scam and cheat people who are deaf and hard of hearing. Be especially alert in late March and early April.

How to know it’s really the IRS

Phishing scams are getting more sophisticated each year as the criminals learn from past successes and failures. Here are steps the IRS will take if they need to contact you:

The IRS WILL do this to contact you

  • Send “snail mail” communication: Send a communication via the United States Postal Service, often called notices. They will usually send multiple notices in the mail.
  • Verify their identity in person: According to the IRS, “If an IRS representative visits you, he or she will always provide two forms of official credentials called a pocket commission and a HSPD-12 card. HSPD-12 is a government-wide standard for secure and reliable forms of identification for federal employees and contractors. You have the right to see these credentials. And if you would like to verify information on the representative’s HSPD-12 card, the representative will provide you with a dedicated IRS telephone number for verifying the information and confirming their identity.”

The IRS WILL NOT do this to contact you

  • Call to demand immediate payment using a specific payment method such as a prepaid debit card, gift card or wire transfer. Generally, the IRS will first mail a bill to any taxpayer who owes taxes.
  • Demand that you pay taxes without the opportunity to question or appeal the amount they say you owe. You should also be advised of your rights as a taxpayer.
  • Threaten to bring in local police, immigration officers or other law-enforcement to have you arrested for not paying. The IRS also cannot revoke your driver’s license, business licenses, or immigration status. Threats like these are common tactics scam artists use to trick victims into buying into their schemes.
  • Ask for credit or debit card numbers over the phone.

Read More: How to know it’s the official IRS

Best practices to spot and avoid phishing scams

  • Generic salutation – Beware the “Hello” or “Dear Customer” intro line
  • Request for personal information – Be on guard for the “Please click here to enter your credit card number” call to action
  • Urgency – Beware of the “Immediate Action Required” subject line or general urgency driver
  • Links – Sometimes you have to hover over “Click here” links to verify the underlying URL is real

How to report IRS phishing emails

Send the email in question to “[email protected]”. Visit the official IRS site with specific tips on what to do depending on the type of scam.



TurboTax tips

IRS tips