Each year, the IRS releases a list of the biggest IRS scams to watch out for, called the Dirty Dozen. This year's IRS Dirty Dozen list contains some familiar scams, including phishing and ransomware attacks, which have also been featured on previous lists. Fraudsters have designed increasingly complex scams over the years, so it's important to keep up with the IRS's latest guidance at tax time.
The Dirty Dozen list features a mixture of business fraud and tax scams targeting individuals. While not every item on the list will apply to the average person, here are some of the most common scams consumers should be aware of this year.
Phishing is one of the most common scams, which means it makes a regular appearance on the Dirty Dozen list.
Phishing usually involves scammers setting up a fraudulent website that asks consumers to enter personal information. For example, you may get an email saying you are entitled to a tax refund, with a link to a fake government website.
The IRS says they have seen an increase in phishing emails using keywords such as "coronavirus," "COVID-19," and "stimulus," which makes them seem more convincing. However, the IRS will never contact you about refunds or stimulus checks via email, so treat any emails you get as suspicious and report them.
If you're ever unsure about an email, the best thing to do is head over to the official IRS website and check there. They will even have an official number that you can call for guidance.
Threatening impersonator phone calls
This is sometimes referred to as "vishing," or voice phishing, and is another common IRS scam. It involves a scammer calling someone and claiming to be from the IRS. The caller will be threatening and attempt to instill fear to get you to hand over personal information.
Remember, the IRS will never call and demand immediate payment with threats. If you are facing any tax problems, it's best to verify that the contact is legitimate.
Social media scams
Unfortunately, social media has become a playground for scammers. In 2020, there was a rise in fake charity scams across social media, but there are also plenty of tax-related identity scams happening on social channels as well.
This type of scam can happen any time of year but mainly happens during tax filing season. Scammers will try to file fraudulent tax returns in your name, using information collected over social media. They will often do this by impersonating a friend or family member on social media to get you to hand over information. They may even direct you to a phishing website, like a fake IRS website, which collects any details you enter there.
According to the IRS, scams targeting senior citizens are still a growing problem. While many older adults are now comfortable using technologies such as social media, this has only led to more avenues for scammers to take advantage of senior citizens.
Phishing scams and social media scams are particularly common tactics in senior fraud, especially during COVID-19 and tax season.
Scams targeting non-English speakers
Another common scam targets non-English speakers specifically. These scams are usually threatening and are designed to intimidate those with limited access to information.
These scams usually involve a phone call threatening deportation or jail time, supposedly from the IRS. Those who are recent immigrants are particularly at risk of these scams.
Ransomware has been a popular tactic for a while now and shows no sign of going away. Ransomware is a type of malware, which is a piece of invasive software mistakenly downloaded by a user. Once the software is downloaded, it encrypts sensitive data that can only be unlocked if you pay a ransom. Payment is usually requested in Bitcoin through anonymous messaging platforms.
Ransomware is commonly installed when unsuspecting users click on malicious links or attachments, usually in emails. That's why it's so important to be cautious when receiving any suspicious emails.
Stay safe this tax season
Protecting yourself from scams and fraud starts with awareness and education. That's why the IRS Dirty Dozen list is published each year to keep people up to date on the dangers.
One of the easiest things you can do to protect yourself is to remain cautious over phone calls, emails, and social media messages. Anytime you are asked to provide sensitive information or are asked to log in to a website through a specific link, you should treat it with caution. If you do suspect an IRS scam, you can report them directly to the IRS.