Tax scams rarely stay the same for long. Each filing season brings new tactics designed to trick taxpayers into revealing personal information or claiming refunds they are not entitled to receive. In recent years, fraud tied to unemployment systems, stimulus payments and identity theft caught many taxpayers by surprise. Some people did not discover the problem until their legitimate tax return was rejected, or unexpected tax forms arrived in the mail.

Two years later, promoters marketed confusing credits such as the Employee Retention Credit to businesses that did not qualify, collecting fees to file improper claims. By 2025, misleading guidance spread widely on social media, encouraging taxpayers to misuse forms like 4136 or modify wage information through consumer tax software.

Each of these scams relies on confusion around tax rules and filing systems. Understanding how they work can help you spot red flags before submitting your return this year.

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IRS WARNS TAXPAYERS OF NEW MAILING REFUND SCAM
 

2021 tax scams: Unemployment fraud and stimulus payment theft

In 2021, identity theft linked to unemployment programs created widespread tax problems. Criminals used stolen Social Security numbers to file benefit claims through state 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 the records.

Stimulus payments were also targeted. Scammers filed early tax returns using stolen personal data to claim Recovery Rebate Credits or redirect refunds. When legitimate filers later submitted their returns, some were rejected because a return tied to their Social Security number had already been processed. Federal agencies, including the FBI, 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.

Worried your SSN may have been stolen? Many tax fraud cases begin with data pulled from breaches. You can run a free scan with our top Identity Theft Protection pick to check whether your information appears in known data-leak records. The scan looks for matches tied to your email address and shows the results in real time. See my tips and best picks on Best Identity Theft Protection at Cyberguy.com.

2023 tax scam warning: Ghost preparers filing fraudulent returns

The IRS later flagged a rise in returns prepared by so-called ghost preparers. These individuals charge fees to prepare tax returns but refuse to sign them or include a valid Preparer Tax Identification Number. Under federal tax rules, anyone paid to prepare a return must sign it. When a preparer does not, the taxpayer, not the preparer, remains responsible for the filing.

In many flagged cases, ghost preparers inflated tax credits, fabricated income figures or altered withholding amounts to generate larger refunds. Some charged fees based on the size of the refund, which created an incentive to push questionable claims rather than follow tax rules.

2025 tax scams: Social media tax ‘hacks’ and improper filings

By 2025, misleading tax advice began circulating widely on short-form video platforms and social media. Some posts encouraged people to file Form 4136 to claim a fuel tax credit for gasoline used in personal vehicles. The IRS says this credit applies only to certain business and off-highway uses, not everyday driving. Filing the form improperly can trigger an IRS review.

Other posts instructed taxpayers to modify wage or withholding numbers inside consumer tax software to inflate refund amounts. The IRS has repeatedly warned that taxpayers remain responsible for the accuracy of their returns, regardless of where the advice originated. Filing incorrect income information or claiming unsupported credits can delay refunds and potentially lead to penalties. 

ELON MUSK ALLEGES $50B IN FRAUD AT TREASURY AFTER JUDGE BLOCKS DOGE AUDIT

2026 IRS warning: Tax scams expected this filing season

The IRS recently released its 2026 “Dirty Dozen” list of tax scams it expects to circulate during the 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 issue or account problem in an attempt to collect Social Security numbers, bank details or login credentials.

The agency emphasizes that it does not initiate contact through 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 improper credit claims. Identity theft refund fraud remains part of the enforcement picture, with criminals filing returns using stolen data before legitimate taxpayers do.

How to protect yourself from tax scams

A few simple habits can reduce your risk during filing season.

1) Monitor your personal data and credit activity

Identity theft refund fraud remains a major concern. Criminals sometimes file tax returns using stolen personal information before the legitimate taxpayer submits theirs. Because many tax fraud cases begin with personal data exposed in breaches, keeping track of where your information appears online can help you catch warning signs earlier. 

Identity theft services scan known data breach records for matches tied to your email address, Social Security number and other identifiers.

These services also monitor credit files across the three major U.S. credit bureaus and alert you to new accounts, hard inquiries or other changes to your credit report. If suspicious activity appears, members receive real-time alerts as soon as it is detected.

See my tips and best picks on 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 through email, text messages or social media to request personal information. Messages claiming to be from the IRS asking for sensitive data are usually scams.

AVERAGE TAX REFUND TOPS $3,700 MIDWAY THROUGH FILING SEASON, TREASURY SAYS
 

4) File your return early

Identity thieves often attempt to file fraudulent tax returns before the real taxpayer does. Filing earlier in the season can reduce that risk.

5) Consider an IRS Identity Protection PIN

This six-digit code adds an extra layer of security to your tax return. Without it, criminals cannot file a return using your Social Security number.

What to do if someone files a tax return in your name

If the IRS rejects your return because one has already been filed using your Social Security number, you may need to complete IRS Form 14039, Identity Theft Affidavit. The IRS may also require identity verification before processing your return. In some cases, affected taxpayers must submit a paper return while the agency investigates the suspected fraud.

Kurt’s key takeaways

Tax scams change every year, but the pattern stays the same. Criminals look for confusion around tax rules, new programs or trending online advice and use that uncertainty to push fraudulent claims or steal personal information. The best protection is slowing down before you file. Verify tax advice through trusted sources such as the IRS, work only with legitimate tax preparers and keep a close eye on your personal data and credit activity. A little caution during filing season can help prevent months of headaches if your return gets flagged for fraud.

Have you ever received a suspicious tax message, questionable filing advice online or discovered a tax return filed in your name? Let us know by writing to us at Cyberguy.com.

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