The IRS recently released Tax Tip 2021-164 giving taxpayers guidance on how to recognize various tax related scams, typical IRS operating procedures so it can help taxpayers identify potential scams, and how to report attempted scams to the IRS.

Among the types of scams discussed in the tax tips and what to do are the following:

Email Phishing Scams – This is where scammers use emails or text messages to trick individuals into giving them some type of personal information such as social security numbers, bank account numbers, passwords, or other sensitive personal information. Often these texts or emails can look very official with designs to look like they are coming from a real organization.

The IRS does not email or typically call taxpayers or request financial information. In some very special situations, they will call or come to the taxpayer’s home or business. But these are special interactions rather than the norm. The way the IRS operates if there is an outstanding tax due, they will mail the taxpayer a notice, and inform the taxpayer how to make a payment.

If a taxpayer believes they have received a suspicious phishing scam email from the IRS, Treasury, or other tax related email. They should save the email and send the email with any attachments to phising@irs.gov. They should not reply to the email, open any attachments, click on any links, or take any other actions that would put them in jeopardy.

Phone Scams – These are generally scammers that call pretending to represent the IRS and telling the individual that there is a delinquent tax amount due to the IRS that requires immediate payment by credit card or other means, and if not the IRS may levy their account, put them in jail, or some other kind of severe consequences if payment is not made.

As noted above, the IRS does not call taxpayers. They typically mail a notice.

The IRS or any of their third-party collection agencies do not do any of the following:

  • They do not call or leave messages on a taxpayer answering machine threatening the taxpayer that they will bring in the local police, deport them, revoke their licenses or other types of consequences for not paying a tax due.
  • They do not demand immediate payment with a credit card (including prepaid cards), gift card, or wire transfer, or ask for checks for third parties.
  • They do not Demand payment without allowing the taxpayer to question the amount owed or appeal.

The IRS advises if a taxpayer receives such a call they should:

  • Hang up immediately and do not give any information
  • Report the scam call to the Treasury Inspector General for Tax Administration
  • Report the call to the Federal Trade Commission
  • Report the caller ID# and the callback number of the scammer to phising@IRS.gov and put in the subject line “IRS Phone Scam”

About the Authors

Doug Finkle is a Director in the Tax Department at SobelCo. With a career spanning more than twenty years, Doug brings a depth of knowledge and experience to the firm. Over the years, he has developed strong competencies in handling tax compliance for corporations (including consolidations), partnerships, S corporations, and high net worth individuals. In addition, Doug is known for sharing his in-depth knowledge of tax laws and regulations, particularly by leveraging his broad involvement with tax planning and developing tax minimization strategies for clients. Drawing on this unique mix of knowledge of tax laws, Doug has proven to be an excellent problem solver who applies his strong analytical skills to help clients address their simple and complex issues. He also has expansive knowledge of preparing and reviewing tax provisions under ASC 740 Accounting for Income Taxes.

Mariana Moghadam is a Member of the Firm and is Tax Leader of the firm's Real Estate practice group. With more than 20 years of professional experience in public accounting and private industry, her extensive background covers a full range of domestic tax entities (corporations, partnerships, limited liability companies, and REITs) and jurisdictions (federal, state, local, and multi-state taxes) as well as international matters.