As April creeps up closer and closer, there is one thing every American is dreading. Fine, two things… Tax season and the plethora of IRS scams that come with it. Scammers often tailor their scams to what's going on at specific times of the year, and tax season is no different. That's why we've made this comprehensive list for all the most common IRS scams you may get hit with over the next few months.

IRS Lawsuit Scam

The IRS lawsuit scam is among the most common scam targeting American taxpayers and results in millions of dollars in losses each year. Essentially, scammers impersonate the IRS over email, phone calls, or even good old fashioned post by accusing victims of owing them money and threatening lawsuits unless they pay their "debt" directly.

Although attempts over email and post do occur, the most common communication method for this particular scam is an automated 'robocall'. The recording is an automated message that says the IRS is filing a lawsuit against you and provides a number to call back to resolve the issue. These kinds of robocalls are able to efficiently target millions of taxpayers over their mobile devices, and although many of them will not fall for the scam, scammers know at least some will. Be extra cautious with any incoming calls that have automated messages allegedly from the IRS. They are pretty much always a scam.

Social Security Account Number Scams

The SSAN tax scam refers to scammers who threaten to suspend or cancel their victim's Social Security Number if they don't pay their "overdue taxes". Both email and phone calls (often beginning as robocalls) are used to carry out this scam and, in addition to demanding money directly, scammers are also hoping to acquire their victims' private information such as their SSN and SSAN.

If you receive a call or email like this, keep in mind that nobody, including the federal government, can just "cancel" your SSAN. This is an identification number that lasts for life.

COVID Related Tax Fraud

COVID changed the world in many ways, and the impact it had on scams was no exception. For tax related scams in particular, scammers have attempted to defraud victims by suggesting misuse of pandemic related assistance, Economic Impact Payments (EIPs), or stimulus packages. Scammers will impersonate members of the IRS, the treasury department, or even law enforcement agencies and demand payment in the form of debit cards or gift cards. Other reports have shown them asking for bank accounts and routing numbers.

Unemployment Fraud/Identity Theft

Unemployment fraud can take many forms, but again due to COVID resulting in so many people losing their jobs and filing for unemployment, a common scam to look out for is the identity theft based scam. If you receive a Form 1099-G for unemployment compensation that you haven't actually received, this is a sign that your identity may have already been stolen. If there is any indication that you've been a victim of this, notify law enforcement authorities immediately.

Ghost Tax Return Scam

Also known as "ghost preparers", the ghost tax return scam refers to scammers who impersonate legitimate tax preparers and offer to assist their victims with their taxes, with the caveat that they do not sign the tax return that they prepare. Of course, it is a standard practice for any tax preparer to sign such documents, so this is a major red flag. The result is the scammer arranging the tax refund to go into their own bank account rather than their victims. Whenever acquiring the service of a tax professional, always make sure to check for proper credentials, licensing, and never hand over your tax files to anyone who isn't certified in your jurisdiction.

Interest and Penalty Free Extensions for a Discount/Fee

This scam refers to scammers who offer fake extensions on their victims' tax reports for an alleged "discounted fee". Although the IRS does in some circumstances allow "relief" from payment obligations, these particular "extensions" are of course bogus and will result in the victims both losing money and not having their taxes done in time.

Cryptocurrency-Related Tax Scams

With the explosion of cryptocurrency in recent years, and regulations and safeguards constantly having to be updated, crypto-related tax scams are definitely something to watch out for. A common one involves investing tax refunds in cryptocurrency for alleged tax circumvention in the future. Essentially, this refers to scammers convincing victims that their tax refunds can be placed somewhere outside of the IRS. This is of course false since IRS taxes cryptocurrency profits just like any other asset. Long story short, the money from the tax refund will be lost directly to the scammer.

Resolving Tax Jeopardy by Direct Payment

This scam refers to scammers who take advantage of vulnerable victims in some type of tax jeopardy, offering them the chance to resolve their issue with one easy direct payment. This can understandably be very tempting if you're in this kind of desperate situation, but before making any payment, always remember to verify and communicate with the IRS through their regular channels.

Tips to Protect Yourself Against IRS Scams

1. The real IRS does not contact taxpayers by email, text message, or social media to request personal or financial information. They also do not ask for credit or debit card numbers over the phone, nor will they ever request payment via gift card. If anyone claims to be from the IRS doing any of those things, it is most definitely a scam.

2. The real IRS may sometimes call you, but not without attempting to contact you by mail first, and if they do call, they will never demand money directly. If someone says they're from the IRS on the phone, either go to your local IRS office to verify or call into a regional office's switchboard number directly from the IRS website.

3. The real IRS will never request that a payment is made to a person or organization other than the U.S. Treasury.

4. The real IRS will never threaten to immediately bring in local police or other law-enforcement groups to have the taxpayer arrested for not paying. They will also never demand taxes be paid without giving the taxpayer the opportunity to question or appeal the amount owed.

5. The IRS website is a great resource to consult if you're suspicious that someone is attempting to scam you, as well as any other tax-related question you might have.

6. When in doubt, Whois by SIPSTACK allows you to easily check the safety of any phone number that's calling you.

How SIPSTACK Fights Fraud

Using the latest technology and machine learning, SIPSTACK's systems authenticate all activity in real time against variables that affect your security. When a carrier implements SIPSTACK's Smart CNAM, they are able to customize a threshold for calls to pass through, based on their specific needs. At SIPSTACK we take an active role in ensuring we are building a secure and connected tomorrow. Contact us today to learn how you can protect yourself from spam.