Tax Scam Prevention: IRS Impersonation and Filing Fraud

Tax scams surge every year during filing season but operate year-round, generating hundreds of millions in losses. The IRS consistently ranks as one of the most impersonated government agencies. These scams range from threatening phone calls demanding immediate payment to sophisticated identity theft operations that file fraudulent returns in your name and steal your refund.

IRS Impersonation Scams

Phone scams. Callers claim to be IRS agents and threaten arrest, deportation, license revocation, or property seizure if you do not pay an alleged tax debt immediately. They demand payment via gift cards, wire transfer, or cryptocurrency. The IRS has confirmed it never threatens arrest over the phone, never demands specific payment methods, and always initiates contact through postal mail for legitimate issues.

Email and text phishing. Emails appearing to come from the IRS, tax software companies (TurboTax, H&R Block), or state tax agencies contain links to fake login pages that capture your credentials and personal information. The IRS does not initiate contact by email, text message, or social media to request personal or financial information.

Fake IRS letters. Scammers mail fraudulent IRS notices demanding payment. These use IRS logos and formatting but contain subtle differences: incorrect addresses, unusual payment instructions, or phone numbers that do not match the IRS. Verify any IRS letter by calling the IRS directly at 1-800-829-1040 or checking your account at irs.gov.

Tax Identity Theft

This is the more financially devastating variant. Criminals use stolen Social Security numbers to file fraudulent tax returns early in the filing season, claiming refunds before the real taxpayer files. The victim discovers the fraud when their legitimate return is rejected as a duplicate.

Tax identity theft has been facilitated by massive data breaches (like the 2017 Equifax breach that exposed 147 million SSNs) and dark web marketplaces that sell complete identity packages. The IRS prevented $5.5 billion in fraudulent refunds in 2023, but billions more succeed.

Prevention Measures

File early. The most effective defense against tax identity theft is filing your return before the scammer does. File as soon as you have all necessary documents.

Get an IRS Identity Protection PIN (IP PIN). This six-digit number, issued by the IRS, must be included on your tax return. Without it, a return filed in your name will be rejected. Apply at irs.gov/ippin.

Protect your SSN. Never provide your SSN in response to unsolicited requests via phone, email, or text. Only share it when legally required with verified entities.

Use secure tax preparation. File through official tax software or verified tax professionals. Avoid unfamiliar tax preparation services that may misuse your information.

Monitor for suspicious activity. If you receive an IRS letter about a return you did not file, earnings you did not have, or a refund you did not claim, contact the IRS immediately and file Form 14039 (Identity Theft Affidavit).

For more on protecting your personal information from theft, see our identity theft protection guide. To understand how government impersonation works beyond tax scams, explore our government impersonation scams guide.

State-Level Tax Scams

While IRS impersonation gets the most attention, state tax agency scams are also prevalent and sometimes more believable because taxpayers are less familiar with how their state tax agency communicates. State-level scams follow the same patterns: threatening calls, phishing emails, and fake refund notifications. Verify any state tax communication through your state’s official tax agency website.

Additionally, be aware of tax preparer fraud. Some fraudulent tax preparers inflate deductions to generate larger refunds, claim a percentage of the refund as their fee, and then disappear when the IRS audits the return. Only use licensed, reputable tax professionals and verify their IRS PTIN (Preparer Tax Identification Number) at irs.gov.