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The IRS has revealed its annual “Dirty Dozen” list of tax scams, and as might be expected the 2020 top 12 include coronavirus-related schemes. These range from stealing economic impact payments (EIPs) to enticing taxpayers to donate to fake coronavirus related charities. 

The IRS expects these schemes to go on throughout 2020 and warns taxpayers to be vigilant. The revenue service advises consumers to become familiar with the list and warns against engaging with potential scammers on the phone or online. 

Here are the top 12 to watch out for:

  • Fake charities – These schemes tend to start with an unsolicited phone call, text, email, or social media message/post from a fake website using a name similar to a legitimate charity. The schemer will either directly ask for money or entice taxpayers to reveal personal financial information. In some cases, the perpetrator may claim to represent the IRS and be working to help victims file casualty loss claims and get tax refunds.
  • Phishing — The IRS has seen an increase in fake emails, letters, and texts about tax bills, refunds, and EIPs. The messages claim to be from the IRS and ask taxpayers for personal identifying information or account data. The messages usually include keywords such as “coronavirus,” “Covid-19,” and “stimulus,” and prey on taxpayer fears of the virus.
  • Threatening impersonator phone calls – Beware of phone calls from someone claiming to be with the IRS and threatening arrest, deportation or license revocation if a fake tax bill isn’t immediately paid. New this year are threatening calls about EIPs.
  • Social media scams – Scammers are using information obtained on social media sites to impersonate family, friends and co-workers. Contact comes via social media messaging, or email or text, from a supposed close contact and might ask for a donation to a fake charity, include a link to something of interest which contains malware, or ask for financial information. Scammers are also infiltrating consumers’ email accounts and phones to go after contacts with fake emails or texts.
  • EIP or refund theft – Criminals are stealing taxpayers’ identities and filing false tax returns with the IRS, diverting refunds and EIP checks to the wrong address or bank account.
  • Senior fraud – Scams targeting senior citizens are on the rise this year and include fake emails, text messages, and links to bogus websites. The IRS has seen a major threat from phishing schemes related to coronavirus that attempt to steal personal information from the elderly.
  • Non-English speakers – These target taxpayers with limited proficiency in English. They are often threatening with the speaker claiming to be from the IRS. In some cases, the scammer has some taxpayer data, such as address or other personal details. This year’s schemes are targeting individuals receiving EIPs.
  • Unscrupulous return preparers – Watch out for what the IRS calls “ghost” preparers. These individuals often promise huge refunds based on fake credits and will charge based on a percentage of that refund. With Covid-19 resulting in some tax professionals’ offices being closed, the IRS warns taxpayers to make sure they are using a credible tax preparer.
  • Offer in Compromise (OIC) mills – Taxpayers should beware of debt resolution companies that promise to settle tax debt for pennies on the dollar through an OIC and charge large fees for the application.
  • Fake payments followed by repayment demands – In this scam, the criminal obtains a taxpayer’s bank account information and Social Security number, then files a bogus tax return and has the refund directly deposited into the taxpayer’s account. The scammer then poses as an IRS employee and demands the return of what they call an erroneous refund. The taxpayer is told to buy specific gift cards in the amount of the refund and threatened with penalties and interest for inaction.
  • Payroll and HR scams – These are up with many employees now working from home. One of the most common scams uses a compromised business email account to request purchase of gift cards. In another, the fraudster impersonates an employee and asks the employer to reroute direct deposits to the scammer’s bank account. These emails often include fake IRS documents to make them look more official.  
  • Ransomware — Cybercriminals are using phishing emails to trick taxpayers into opening a link or attachment to a fake Covid-19 charity, that instead includes ransomware that then infects the victim’s computer or network.

Consult An Experienced Tax Attorney

If you have more questions about the IRS’ Dirty Dozen, please contact Wiggam & Geer at (404) 609-1300 or visit our website. One of our experienced Atlanta tax lawyers or Atlanta tax settlement attorneys would be happy to speak with you.