Every year during tax season, millions of Americans file their returns expecting a refund. Unfortunately, as any cybersecurity keynote speaker will tell you, this period is also prime time for scammers and cybercriminals. Threat actors know taxpayers are closely watching their mail, email, and bank accounts for tax information, and they expertly exploit this anticipation through IRS impersonation scams and tax refund fraud.
The Anatomy of an IRS Impersonation Scam
One of the most common social engineering schemes involves criminals posing as the Internal Revenue Service (IRS). These scammers contact victims via phone, email, text message, or social media, falsely claiming to represent the IRS. Using official-sounding language and urgent threats, they tell victims they owe back taxes and must pay immediately or face arrest, harsh penalties, or frozen assets.
Cybercriminals often demand payment through unusual, untraceable methods such as gift cards, wire transfers, or cryptocurrency—tactics the real IRS does not use. These impersonation scams are highly effective because they rely on fear and the assumed authority of the government. Criminals exploit that fear by creating a false sense of urgency, discouraging victims from questioning the fraudulent request.
Remember: The IRS typically initiates contact with taxpayers through official letters sent by mail, not through unexpected phone calls, phishing emails, or text messages requesting immediate payment or sensitive personal information.
Tax Refund Fraud: A Severe Form of Identity Theft
Another major cyber threat during tax season is tax refund fraud, a damaging form of identity theft. In these cases, malicious actors use stolen personal information—such as your Social Security number, date of birth, and address—to file a fraudulent tax return in your name.
This fake return claims a refund, which is then routed to an account controlled by the cybercriminal. Victims often only discover the crime when they attempt to file their legitimate tax return, only to receive a notice that a return has already been filed using their Social Security number.
How Cybercriminals Steal Your Data
As a cybersecurity expert, I often highlight how scammers obtain the sensitive data needed for these crimes. They use a variety of methods, including:
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Data Breaches: Capitalizing on previously leaked personal information.
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Phishing Emails & Smishing (Text Scams): Sending fake messages that appear to be from the IRS, directing victims to malicious websites designed to harvest personal and banking information.
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Social Engineering: Convincing victims to provide sensitive data directly over the phone.
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Fraudulent Tax Services: Setting up fake tax preparation services to steal client data.
Once criminals obtain enough personal information, they can submit fraudulent returns and attempt to collect refunds before the real taxpayer even files. Tax scams are widespread and continue to evolve as criminals adapt their tactics. Authorities have received millions of reports of these IRS impersonation attempts, with victims losing millions of dollars to these schemes over the years.
Cybersecurity Best Practices: How to Protect Yourself
Fortunately, there are actionable steps taxpayers can take to protect their personal data and financial assets.
- Verify the Source: Be highly cautious of any unexpected message claiming to be from the IRS, especially those demanding immediate payment or requesting personal information.
- Beware of Phishing Links: Avoid clicking links or downloading attachments from suspicious, unsolicited emails or texts.
- File Early: File your tax returns as early as possible to reduce the window of opportunity for cybercriminals to submit a fraudulent return in your name.
- Monitor Your Accounts: Regularly check your financial accounts and credit reports for any unusual or unauthorized activity.
Bring Cyber Awareness to Your Organization
Tax season should be about filing returns and receiving refunds—not dealing with cybercriminals. By understanding the mechanics behind IRS impersonation scams and tax refund fraud, taxpayers can better protect themselves and avoid becoming the next victim.
Looking to educate your team on the latest cyber threats, phishing scams, and data protection tactics? Contact us to book a top cybersecurity keynote speaker for your next corporate event to empower your organization with the knowledge they need to stay secure.