During the summer season, it’s critical to be vigilant about potential email scams related to the IRS. Everyday, the IRS receives numerous scam emails forwarded by vigilant taxpayers. Among various tax-related scams, those involving employee retention tax credits and “stimulus” payments are the most prevalent in individuals’ inboxes.
IRS Commissioner Danny Werfel warns that these summer scams are persistently targeting taxpayers. He emphasizes that individuals are becoming overwhelmed with these deceptive email and text messages. One common scam revolves around the Employee Retention Credit (ERC), a refundable tax credit offered to qualified employers affected by the COVID-19 pandemic. The scam attempts to trick people into believing they may be eligible for the ERC, even though it’s not available to individuals.
IRS Email Scams This Summer Season
Unfortunately, these scammers are not limited to email communication. They utilize postal letters, social media posts, and phone calls to deceive taxpayers into claiming the ERC tax credit erroneously. Here are some red flags that suggest you might be encountering an ERC scam:
- The scammer tells you that you qualify for the credit without knowing any details about your tax situation.
- You are asked to pay a significant upfront fee to determine your eligibility.
- You are required to pay a fee calculated as a percentage of the ERC amount.
- The scammer tells you there’s no risk in filing the claim.
- You receive an unexpected call, email, or other form of communication from a stranger.
If you believe you’re eligible for the employee retention credit, consult with a reliable tax professional. Be aware that falsely claiming the credit will necessitate repayment.
Beware of the Third Economic Impact Payment Scam
While some states are issuing ‘stimulus payments’ in 2023, the Federal government is not. The last federal economic impact payments were distributed in 2021. Despite this, scammers have been tempting taxpayers with false information about these payments. The IRS reports that this scam is adapting, with thousands of reports this month from taxpayers who have received dubious emails. These emails, laden with mistakes, assert that a “third round economic impact payment” can be claimed.
The IRS has completed issuing all economic impact payments. If you suspect that you didn’t receive a payment during the pandemic, check your IRS online account to confirm the payment amounts. Also, differentiate these federal payments from current state tax rebates or inflation relief payments.
Recognize Other Tax Scams
Any email claiming to be from the IRS is a scam. The IRS will never contact you through email, text, or social media. However, some scams are more subtle. For instance, Kiplinger highlighted a mail scam about IRS refunds, in which fraudsters sent taxpayers physical letters about fictitious unclaimed tax refunds.
These scams often contain clumsy language and false information, making them somewhat easier to identify. However, it’s not always clear-cut. Instead of responding to these letters, reach out to the IRS directly for clarification.