Tax Fraud Indicators that Taxpayers Must Watch Out

Last updated on November 22, 2022

Tax fraudsters often use methods such as threatening, tempting and/or misinforming a taxpayer to obtain either confidential information or cash. They commonly use fake identities. Their usual methods of communicating with taxpayers is to send unsolicited emails pretending to be the IRS or a reputable financial institution.

If taxpayers receive communication from any source that requires them to share sensitive information such as their Social Security Number, tax filing status, passwords and PINs, they should never respond or share any information. If they need to, they should call or send an email to the authority concerned using its correct number or email address to make inquiries.

Any unsolicited email that encourages clicking on links or attachments can be an attempt to get malware into the computer. Such emails must not be explored or responded to.

Tax fraudsters may also use temptation to get taxpayers to cooperate with them in their illegal schemes. They twist facts and bloat rewards to encourage taxpayers to defraud the IRS. Usually, they promise exaggerated tax refunds for filing inaccurate tax refunds or evasion of taxes through secret bank accounts or fake charitable trusts. To avoid falling victim to tax fraudsters, taxpayers must keep themselves informed about the most common tax laws, methods tax frauds use to deceive taxpayers, and the results of non-compliance.