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Tax scams rarely last long. Each filing season brings new tricks designed to trick taxpayers into revealing personal information or claiming refunds they don’t deserve. In recent years, fraud related to unemployment programs, incentive payments and identity theft have caught many taxpayers by surprise. Some people didn’t discover the problem until their official tax return was rejected or unexpected tax forms arrived in the mail.
Two years later, developers marketed confusing credits like the Employee Retention Credit to businesses that didn’t qualify, collecting fees for filing unfair claims. In 2025, misleading guidance spread widely on social media, encouraging taxpayers to misuse forms like 4136 or correct income information with consumer tax software.
Each of these scams relies on confusion about tax laws and filing systems. Understanding how they work can help you spot red flags before you file your return this year.
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IRS WARNS PAYERS ABOUT NEW POSTAGE REFUND RULE
Tax scams have gone from defrauding the unemployed to “tax hacking” on social media, with the IRS warning of new threats for the 2026 filing season. (Michael Bocchieri/Getty Images)
Tax scams of 2021: Unemployment fraud and incentive payment theft
In 2021, identity theft linked to unemployment programs created widespread tax problems. Criminals use stolen Social Security numbers to file benefit claims through government systems. Because unemployment income is taxable, Form 1099-G notices were sent to victims for payments they never received. The IRS advised taxpayers not to report fraudulent income and to contact the issuing state agency to correct records.
Renewal payments were targeted. Fraudsters file tax returns early using stolen personal data to claim Income Tax Credits or redirect refunds. When legal filers later submitted their returns, some were rejected because returns associated with their Social Security number had already been processed. Federal agencies, including the FBI, have warned of high levels of unemployment fraud during this period. The IRS also encouraged taxpayers to sign up for an Identity Protection PIN, which adds an extra layer of verification when filing.
Are you worried that your SSN might have been stolen? Most tax fraud cases begin with data released in a breach. You can do a free scan with our top picks for identity theft protection to check if your information appears on known data breach records. The scanner looks for matches tied to your email address and displays the results in real time. See my tips and top picks for Best Identity Theft Protection at Cyberguy.com
2023 tax scam alert: Ghost preparers file fake returns
The IRS later flagged an increase in returns prepared by so-called ghost preparers. These people charge fees to prepare tax returns but refuse to sign them or enter a valid Preparer Tax Identification Number. Under federal tax laws, anyone who is paid to prepare a return must sign it. If the preparer does not, the taxpayer, not the preparer, remains responsible for filing.
In many flagged cases, ghost preparers inflated tax credits, fictitious income figures or altered withholding amounts to make huge returns. Some fees were charged based on the size of the refund, which created an incentive to enforce questionable claims instead of following tax laws.
Tax scams of 2025: social media tax ‘hacks’ and false filings
In 2025, misleading tax advice began to spread widely on short video forums and social media. Other posts encouraged people to file Form 4136 to claim a tax credit for the fuel used in their vehicles. The IRS says this liability only applies to certain business and off-road uses, not everyday driving. Filling out the form incorrectly can trigger an IRS review.
Some posts instruct taxpayers to change wage or withholding numbers within consumer tax software to increase refund amounts. The IRS has repeatedly warned that taxpayers remain responsible for the accuracy of their returns, regardless of where the advice comes from. Filling out incorrect income information or claiming unsupported credits may delay refunds and may lead to penalties.
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Identity theft and fraudulent tax filings remain top problems for the Internal Revenue Service as criminals take advantage of confusion about debt and filing rules. (Andrew Harrer/Bloomberg via Getty Images)
IRS warning for 2026: Expect tax scams this filing season
The IRS recently released its 2026 “Dirty Dozen” list of tax scams that it expects to spread during filing season. Phishing and text message scams remain among the most common threats. Scammers often impersonate the IRS or tax software companies and claim there is a refund or account problem in an attempt to collect Social Security numbers, bank information or login information.
The agency emphasizes that it does not initiate communications via email, text messages or social media to request sensitive information. The 2026 list also includes ghost preparers and misleading tax advice shared online, including content that pushes for fraudulent credit claims. Identity theft return fraud remains part of the enforcement picture, with criminals filing returns using stolen data before legitimate taxpayers do.
How to protect yourself from tax fraud
A few simple habits can reduce your risk during the filling season.
1) Be aware of your personal data and credit activity
Reinstatement fraud remains a major concern. Criminals sometimes submit tax returns using stolen personal information before the legitimate taxpayer submits theirs. Because many tax fraud cases begin with personal data exposed in a breach, tracking where your information appears online can help you catch early warning signs.
Identity theft services scan records of known data breaches to find matches tied to your email address, Social Security number and other identifiers.
These services also monitor credit files from all three major US credit bureaus and notify you of new accounts, hard inquiries or other changes to your credit report. When suspicious activity occurs, members receive real-time alerts as soon as it is detected.
See my tips and top picks for Best Identity Theft Protection at Cyberguy.com.
2) Work only with legitimate tax preparers
Anyone paid to prepare a tax return must sign it and include a valid Preparer Tax Identification number. Avoid preparers who promise unusually large refunds or refuse to sign your return.
3) Ignore unexpected IRS messages
The IRS does not contact taxpayers via email, text messages or social media to request personal information. Messages claiming to be from the IRS asking for sensitive data are often scams.
TAX REFUNDS VALIDATE ABOVE $3,700 DURING FILING PERIOD, TREASURY SAYS
From fraudulent payment theft to ghost preparers, taxpayers face ever-changing fraud tactics each year during tax season. (John Moore/Getty Images)
4) Apply early
Identity thieves often try to file fraudulent tax returns before the real taxpayer does. Applying early in the season can reduce that risk.
5) Consider the IRS Identity Protection PIN
This six-digit code adds an extra layer of security to your tax return. Without it, criminals can’t file a refund using your Social Security number.
What to do if someone fills out a tax return on your behalf
If the IRS rejects your return because one was filed using your Social Security number, you may need to file IRS Form 14039, Identity Theft Affidavit. The IRS may also require identity verification before processing your return. In some cases, affected taxpayers must file a paper return while the agency investigates suspected fraud.
Kurt’s priority is taking
Tax scams change every year, but the pattern remains the same. Criminals look for confusion about tax laws, new programs or trending online advice and use that uncertainty to push fraudulent claims or steal personal information. The best protection is to slow down before installing. Get tax advice from trusted sources like the IRS, work only with legitimate tax preparers and keep a close eye on your personal data and credit history. A little warning during filing season can help prevent months of headaches if your return is flagged as fraudulent.
Have you received a suspicious tax message, questionable online filing advice or received a tax return filed in your name? Let us know by writing to us at Cyberguy.com.
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