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ASK THE EDD LAWYER – PHONY EMAIL IRS SCAMS ARE ON THE RISE – BE CAREFUL

By Robert S. Schriebman
March 14, 2016

Introduction

Phony "IRS" telephone calls and emails have taken a dramatic increase in the past two months. The IRS is seeing an increase of 400% in email phishing and malware incidents so far this tax season. For example, there were over one thousand such incidents reported to the IRS in January 2016, an increase of 25% from a year ago. IRS Commissioner John Koskinen remarked that "This dramatic jump in these scams comes at the busiest time of tax season."

It is clear from the latest IRS Press Release IR-2016-28, that the IRS can do very little to stop these scams.

In this article I will discuss the dramatic increase in phony emails and telephone calls and tell you what to look for in these scams.

Just How Bad Are These Scams?

These scams have become very sophisticated. Callers tell you that they are agents from the "IRS Criminal Office." They even have a badge number. BEWARE: There is no such place as the "IRS Criminal Office." There is an IRS Criminal Investigation Division (CID). IRS agents don’t have "stinkin’ badges." Real IRS Agents have employee identification numbers EINs and they are required by the 1998 IRS Reform Act to tell you what their number is.

The IRS does not communicate to taxpayers by way of email. Unfortunately, phony IRS emails can look very official. These criminals are not beyond using official IRS emblems. They will use an email address such as "IRS.gov." Just remember that the IRS does not use email in dealing with taxpayers. Therefore, each and every email purportedly from the IRS is automatically phony!

The goal of these phony emails is to get you give out personal tax information that can be used to file phony IRS refund tax returns. These sites ask for your Social Security number and other personal information. The sites also carry malware which can infect your computer and allow criminals to gain access to your files.

As of February 2016, the number of phony email contacts has doubled from over a year ago. For example, 363 incidents were reported in the first half of February 2016 compared to 201 incidents at the same time in 2015.

The 2016 tax season has barely begun and yet there have been 1,389 incidents as of mid February. This may not seem like very many but, in the entire 2014 tax season, there were only 1,361. The 2015 tax season had a total of 2,748 incidents. This number will be dwarfed by the end of the 2016 season.

IRS Commissioner Koskinen came right out and admitted, "…we are deeply worried…" It appears clear that the bad guys may be more than one step ahead of the IRS and its civilian partners. While the IRS is teaming up with the tax industry and state revenue departments, it is clear that at this point in time government efforts are not keeping up with the scammers.

It’s not just the general public getting these scams. Tax professionals are also reporting phishing scams that are seeking their online credentials and clients’ confidential information

Stop, Look and Listen

The first thing to remember is that the IRS does not use email. Any email message supposedly sent by the IRS is automatically phony. These emails ask you to update important information by clicking on a web link. These links look like official IRS web pages. They are designed to fool you. Therefore, the second thing to keep in mind is not to click on these links. Instead, forward the email to the following official IRS address: [email protected].

By way of example, IRS official Press Release, IR-2016-28, lists the following subject lines and underlining text referencing:

  • Numerous variations about people’s tax refund.
  • Update your filing details, which can include references to W-2.
  • Confirm your personal information.
  • Get my IP Pin.
  • Get my E-file Pin.
  • Order a transcript.
  • Complete your tax return information.

Telephone Contacts Are Also On The Rise

The phony telephone contacts are also increasing dramatically. No one seems to be immune. We get them at our house too. I consider it a public service to be able to calm callers to this office who are victims of these calls. I invite you to call as well. The criminals are perfecting their art. They now have Washington, D.C. telephone prefixes and even background noise that sounds like a real IRS call center. After all, if they are going to separate you from confidential information as well as your tax refund, they have to make it look real.

Conclusion

If you are entitled to an IRS tax refund, don’t wait until April 15 to file your return. Try not to go on an extension. Get your return filed early in the year as possible. The latest IRS Press Release indicates that the scammers start going to work in late January and early February.

Remember, the IRS does not use email to communicate with taxpayers.

***

Robert Schriebman has a successful practice in the Rolling Hills Estates area of Los Angeles County serving clients throughout California and the United States. He has successfully dedicated more than 40 years to helping individual taxpayers, business owners, CPAs, Enrolled Agents, and tax attorneys navigate the complicated tax systems of the federal and state governments.

Robert Schriebman has written the only 2 books ever published dealing with how California Employment Development Department (EDD) operates. See "California Tax Collection Practice and Procedures" and "California Taxation Practice and Procedure," both published by Commerce Clearing House.

Robert Schriebman has written over 20 books including the major manual used nationally by practitioners and the IRS, "IRS Tax Collection Procedures – A Manual for Practitioners" published by Commerce Clearing House.

Robert Schriebman has written over 20 books including the major manual used nationally by practitioners and the IRS, "IRS Tax Collection Procedures – A Manual for Practitioners" published by Commerce Clearing House in addition to the only 2 books ever published dealing with how California Employment Development Department (EDD) operates. See "California Tax Collection Practice and Procedures" and "California Taxation Practice and Procedure," both published by Commerce Clearing House.

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