iBank Enrollment
iBank Pro log in


Tax Refund image
New Tax Return Scam – What You Should Know If You Become a Victim

      It’s that time of year when tax return scams run rampant, and this year is no different, but a new one has recently come to light.

      The IRS issued an alert, noting that data breaches on some tax preparers’ computers have provided fraudsters access to sensitive client information. In response, the IRS has issued a warning to tax preparers warning them of the new scheme, and to watch for phishing emails that can download malware onto their computers, but taxpayers need to be alert, as well.

Warning sign says Scam Alert
Image of tax forms and pencil
      It seems fraudulent tax returns are being filed unbeknownst to taxpayers, and when an erroneous refund arrives via direct deposit into their bank account or by check, fraudsters are contacting the taxpayer, posing as IRS agents demanding that the funds be returned. In some versions of the scam, the criminal poses as a debt collection agency official acting on behalf of the IRS. They tell the taxpayer that the refund was deposited into their account or mailed in error, and ask the taxpayer to forward the money to their collection agency. In another version of the scam, the taxpayer gets an automated call with a recorded voice supposedly from the IRS threatening the taxpayer with criminal fraud charges, an arrest warrant, and “blacklisting” their Social Security Number. The message provides a phone number to contact to make arrangements to return the funds.

      In either case, if you find you are the recipient of a tax refund that you did not initiate yourself by filing your income tax return, the IRS urges taxpayers to follow the established procedures for returning an erroneous refund to the IRS by following the steps outlined by Tax Topic Number 161 – Returning an Erroneous Refund . They recommend that taxpayers discuss the issue with their financial institution because there may be a need to close the bank account involved. Also, taxpayers receiving erroneous refunds should contact their tax preparers immediately.

      Because this is a peak season for filing tax returns, taxpayers who are victims of this fraud scheme and file electronically may find that their tax return will reject because a return bearing their Social Security number is already on file. If that’s the case, taxpayers should follow the steps outlined in the Taxpayer Guide to Identity Theft . Taxpayers unable to file electronically should mail a paper tax return along with Form 14039, Identity Theft Affidavit, stating they were victims of a tax preparer data breach.

      To learn more about what to do if you believe you have been a victim of an IRS tax scam, follow the steps outlined in the Taxpayer Guide to Identity Theft , or call the IRS toll free at 800-829-1040 (individual) or 800-829-4933 (business).