How to Avoid the Newest Tax Scam

How to Avoid the Newest Tax Scam

Over the past 3 years, I have probably said the following phrase a thousand times:

“The IRS will not call you on the phone asking for payment of your taxes.  If you receive a call from someone posing as the IRS asking for immediate payment of your income taxes, it is a scam.”

This statement still holds true. The IRS will not call you asking you to make any kind of immediate payment.

  • They won’t ask you to go to Target, buy a couple hundred dollars in gift cards, and read them the account number and access code from the cards.
  • The IRS also won’t ask you to wire them money.
  • They won’t even ask you to make a payment right now with your credit card number.

Because most taxpayers have become aware of this and are no longer falling prey to this tactic, the criminals have  stepped up their game. They are now sending fake letters to taxpayers requesting payment.

The New Tax Scam

Now, scammers are following the more traditional route of sending letters. If you have received a notice from the IRS, you can take several precautions to ensure the letter is legitimate:

  1. Make sure the envelope is a government envelope with the IRS seal on the letter.
  2. There should be a legend in the top right-hand corner of the notice with the following information:
    • A notice or letter number referencing the correspondence.
    • The primary taxpayer’s social security number (sometimes written out and other times truncated).
    • The tax year or years in question.
    • IRS contact information, normally in the form of an 800, 866, 877 or 888 number. If the number appears to be a personal or cell phone number, it is probably fake.
  3. A real letter from the IRS will include your rights as a taxpayer.
  4. The IRS will not threaten to arrest you or deport you.
  5. The IRS will detail your options regarding payment, but will never ask you to do the following:
    • Make payment in the form of a check made out to anyone other than the U. S. Treasury.
    • Furnish credit or debit card information over the phone.
    • Pay using ITunes, Target or other gift cards.
  6. Remember that any lien the IRS has filed against you is public information and could be used to add validity to the fake correspondence.
  7. The only agencies referenced in a letter will be the Internal Revenue Service, Department of the Treasury, or U. S. Treasury. If your correspondence references the Bureau of Tax Enforcement, it is not a legitimate letter.

Confirm Every Letter with Your Advisor

Receiving any type of correspondence from the IRS is a scary experience for most taxpayers, which is the main reason why scams work so effectively.  Regardless of the correspondence, it is always a good idea to send the letter to your tax advisor and let them give you expert advice on the situation.  Not only could you avoid a scam situation, but the taxing authorities are not always correct in their assessments.

As an added protection, you can purchase audit protection from hbk.  Audit protection not only provides protection against an actual audit, but any correspondence needed to with regard to the IRS.


The author of this blog is Tammy Busby, CPA, CGMA. Tammy has been part of our team for over 22 years and has developed a deep expertise in accounting and tax planning solutions.
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