Tax Scams Escalate with AI-Powered Fraud on the Rise
Robocalls, text messages, and phishing emails from scammers have surged this tax season compared to previous years, according to the consumer protection bureau of the Federal Trade Commission. Artificial intelligence is likely amplifying these fraud attempts, making it crucial for the public to remain vigilant. Consumer advocates and government officials emphasize the need to pause and think before responding to unsolicited communications, noting that the IRS will never initiate contact via text or phone calls.
Annual 'Dirty Dozen' Highlights Impersonation Risks
Each year, the IRS releases its "Dirty Dozen" list of tax scams targeting taxpayers, with agency impersonation through email, text, and phone topping the list. In fiscal year 2025, the IRS reported over 600 social media impersonators and advises people to avoid clicking links or opening attachments from unexpected messages. The agency clarifies that it does not leave urgent, threatening prerecorded messages, demand immediate payment over the phone, or threaten arrest.
Scammers frequently use alarming language and QR codes to direct victims to fraudulent websites where they request personal information under the guise of "verifying" accounts. These links may also install malware or ransomware, potentially locking users out of their files and private data. The IRS notes a rise in AI-enabled impersonation tactics, including robocalls, voice mimicry, and spoofed caller IDs, which enhance the appearance of legitimacy.
Identity Theft: A Common Tax Season Fraud
Rosario Mendez, an attorney for the FTC's bureau of consumer protection, identifies identity theft as one of the most prevalent forms of fraud during tax season. This involves the misuse of social security numbers or other personal details, often to illicitly claim tax refunds. Victims typically discover the theft when attempting to file their returns and find that someone else has already done so using their information.
Eva Velasquez, CEO of the Identity Theft Resource Center, reports a significant increase in scams and identity theft attempts in recent years, likely fueled by AI-generated messages. She describes a "deluge" of phishing emails, fake texts, and phone calls, with scammers employing sophisticated methods to elicit engagement, such as clicking links or sharing personal data.
Expert Advice: "Type, Don't Tap"
Velasquez recommends a key defensive strategy: "Type, don't tap." Instead of clicking on links in suspicious messages, users should manually type the official website URL, such as IRS.gov, into their browser. This approach helps avoid malicious sites. She stresses, "Go to the source. Don't click any of those links. If you didn't initiate the contact, don't engage."
Scammers Target All Age Groups
Kathy Stokes, director of fraud prevention programs for the AARP, notes that while younger people report scams more frequently, older individuals tend to lose larger sums due to having more assets at risk. She advises slowing down and consulting a trusted friend or family member if a message seems suspicious, as this can help identify scams and prevent others from falling victim.
Steps to Take If Identity Is Compromised
If someone has used your social security number to file a fraudulent tax return, it is essential to notify the IRS immediately. Rosario Mendez suggests visiting IdentityTheft.gov to report the theft, which provides a personalized recovery plan. She warns that scammers may use stolen information to open bank accounts, apply for credit cards, or file for unemployment, making credit monitoring and freezes advisable to prevent further misuse.
Alan Butler, executive director of the Electronic Privacy Information Center, supports monitoring services but cautions against overpaying for potentially shady offerings. He highlights the risk of being victimized twice—first by identity theft and then by exploitative monitoring services—and advises thorough vetting of any service providers.
Reporting Fraud to Authorities
For those who have lost money to scams, filing a police report is recommended, even if local law enforcement is hesitant. Kathy Stokes emphasizes that such reports can serve as proof for potential restitution in the future, urging victims to insist on documentation.
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