Summer is a prime time for IRS email scams. The IRS receives hundreds of forwarded scam emails daily from concerned taxpayers. While numerous tax-related scams exist, some involving employee retention tax credits and "stimulus" payments are hitting inboxes more than others.
“The IRS is seeing a wave of these summer scams relentlessly pounding taxpayers,” IRS Commissioner Danny Werfel said in a release, adding "People are being flooded with these email and text messages."
ERC Tax Credit Email Scam
One of the common IRS email scams involves the Employee Retention Credit (ERC). The ERC is a refundable tax credit made available to eligible employers impacted by the COVID-19 pandemic. Individuals don't qualify for the credit, but scammers try to convince people otherwise with a "you may be eligible for the ERC" promotion.
The ERC scam isn’t limited to email. Scammers are also sending letters in the mail, posting on social media, and calling taxpayers to get them to claim the ERC tax credit when they aren't eligible. Here are some typical indications that you're dealing with an ERC scam.
- The promoter (scammer) says you qualify for the credit before knowing anything about your tax situation.
- You are charged a large upfront fee to have the promoter see if you're eligible.
- You are charged a fee based on a percentage of the ERC amount.
- The scammer says you “have nothing to lose” by submitting the claim.
- You receive a call, email, or other communication from someone you don’t know.
If you think you may be eligible to claim the employee retention credit, work with a trusted tax professional. Those who wrongfully claim the credit must pay it back.
Third Economic Impact Payment Scam
While many states are sending so-called ‘stimulus payments’ in 2023, the Federal government isn't. (That's because the last federal economic impact payments were issued in 2021.) But ever since, scammers have been trying to lure taxpayers by claiming to have information about the payments.
Lately, according to the IRS, the scam has evolved and the agency has received thousands of reports this month from taxpayers who have received suspicious emails. The emails are full of errors and claim that a "third round economic impact payment" is waiting to be claimed.
The IRS has already issued all economic impact payments. If you think you have not received a payment issued during the pandemic, log in to your IRS online account to view the payment amounts. Remember too, those federal pandemic-era payments are different from state tax rebates or inflation relief payments you may be receiving now.
Other Tax Scams
Any email you receive that claims to be from the IRS is a scam. That’s because the IRS won’t contact you via email, text, or social media.
However, some scams are not as obvious. For example, Kiplinger previously reported on an IRS refund mail scam, where scammers sent taxpayers physical mailings regarding fake unclaimed tax refunds.
These scammers often use awkward wording and include inaccurate information that can make the scams easier to spot. But that may not always be the case. Rather than respond to the letters, you should contact the IRS directly.
Report Suspicious Emails
You should immediately report suspicious tax-related emails to the IRS. You can forward these emails to phishing@irs.gov. If you have experienced a financial loss as a result of an IRS scam, you can take the following steps.
- Report the loss to the U.S. Treasury Inspector General for Tax Administration (TIGTA).
- File a complaint with the Federal Trade Commission (FTC).
If you need to report other types of IRS scams, visit the IRS’ tax scam information webpage for detailed instructions.
