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February 8, 2018

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Tax Fraud Tuesdays: The Dirty Dozen #3

April 24, 2018


Each year, the Internal Revenue Service compiles a list of the 12 most common, dangerous or costly tax scams. They call this list their “dirty dozen” and recommend that taxpayers stay vigilant during tax season. We will summarize these twelve scams for you, and highlight the steps you should take to protect yourself.


Even though the IRS notes that identity theft is on the decline, taxpayers should stay vigilant and protect themselves from criminals looking to exploit personal information. While identify theft occurs throughout the year, it becomes particularly common during tax season, when scammers use stolen social security numbers (SSNs) or Individual Taxpayer Identification Number (ITINs) to file fraudulent tax returns. The return claims a refund, which the scammer collects.


The number of identity theft victim reports has declined almost 65% from 2015 to 2017, falling from 677,000 cases to just 242,000. During this time the IRS partnered with individual states and tax professionals under the “Security Summit.” As part of this campaign, the IRS published numerous tips for taxpayers listed here, including online security recommendations and steps for victims of data breaches. However, they also note that criminals are becoming more creative as they pursue taxpayers’ personal information, and Americans must remain protective of their data.


Because identity theft starts with stolen personal information, there is no single solution to the problem. Criminals will use different methods including phishing and phone scams to steal the information, so the best way to fight identity theft is to recognize those scams, use security software, and quickly report any potential data breaches. If you believe your personal information has been stolen, the IRS has published a guide to resolving identity theft here.

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