“Dirty Dozen” tax scam list now includes telephone scams

Identity theft and telephone scams top this year’s list of the “Dirty Dozen” fraudulent tax schemes released by the IRS on Wednesday. The annual list contains various common scams that taxpayers may be subjected to at any time, but the IRS says many of them reach a peak during tax filing season. “These schemes jump every year at tax time,” said IRS Commissioner John Koskinen in a prepared statement.

“Pervasive telephone scams” represent a new entry onto the list. The IRS reports an increase in scams in which callers pretend to be from the IRS and try to steal taxpayers’ money or identities. The IRS says that in these scams the callers may say the victim owes money or is entitled to a huge refund. Sometimes the callers threaten the victim with arrest or threaten that his or her driver’s license will be revoked.

The IRS warns that the callers can appear genuine because they may be able to recite the last four digits of the victim’s Social Security number or may imitate the IRS’s toll-free number on caller ID to make it appear that the IRS is calling.

The IRS also warns that some telephone scams target recent immigrants, who are threatened with arrest or deportation if they do not pay up promptly.

The IRS asks that taxpayers who think they are being targeted by phone scammers to contact the Service at 800-829-1040, the Treasury Inspector General for Tax Administration at 800-366-4484, and the Federal Trade Commission using the FTC Complaint Assistant at FTC.gov.

The rest of the “Dirty Dozen” is similar to last year’s list:

• Identity theft;
• Phishing;
• False promises of free money from inflated refunds;
• Tax return preparer fraud;
• Hiding income offshore;
• Charitable organization impersonation;
• False income, expenses, or exemptions;
• Frivolous arguments;
• Falsely claiming zero wages or using a false Form 1099;
• Abusive tax structures; and
• Misuse of trusts.

—Alistair M. Nevius (anevius@aicpa.org) is the JofA’s editor-in-chief, tax.