Scam of the day – July 5, 2017 – IRS private collection scams

Many people have been scammed by criminals calling them on the phone purporting to be from the IRS making various threats unless the targeted victim immediately pays alleged overdue taxes.  For years, I have been telling people that the simplest way to know that the person calling you is not from the IRS is to remember that the IRS will never initiate contact with a taxpayer about overdue taxes through a phone call.  But that has changed.  In 2016 I told you about a new law Congress passed requiring the IRS to use the services of private collection agencies to collect some outstanding taxes.  This law is flawed on many levels including, as was pointed out by the IRS Taxpayer Advocate Service, the fact that this program not only had been tried unsuccessfully twice previously, but also is not cost effective.  But from my perspective, perhaps the greatest problem with this new law is that it increases the likelihood of scammers being able to pose as tax collectors and lure unsuspecting victims into paying these scammers money.

The law has now gone into effect and the IRS is sending letters by regular mail to people whose overdue tax accounts have been turned over to one of the four private collection agencies authorized by Congress to collect overdue taxes for the IRS.  The IRS is also at this time warning people to be wary of people claiming to be working for one of these companies who are, in truth, just scammers.  Of course, the IRS did not give any concrete advice as to how to know if the caller is legitimate or not.


As I have often said, whenever you get a phone call, you can never be sure who is really on the other end of the line.  Even your Caller ID can be fooled by a technique called Spoofing by which it can be made to appear that your call is coming from someone other than the real caller.  It is for this reason that I advise you never to give out personal information such as your Social Security number or credit card information to anyone who calls you on the phone unless you have absolutely confirmed that they are legitimate.  In the case of a call from someone purporting to be collecting a debt on behalf of the IRS, you should not give them any information or agree to do anything on the phone.  Ask them to send you written information about the alleged debt and then call the IRS to find out if the debt is legitimate or not.

In addition, the debts assigned to the private collection agencies are tax debts that are many years old and about which the taxpayer would have been contacted by mail previously by the IRS.  Also, be aware that none of the Congress authorized collectors will ask you to make a payment by credit card over the phone and certainly not ask you to wire money or pay by an iTunes card or gift card as some tax scammers have done.

Scam of the day – June 19, 2017 – New IRS phone scam

A new version of the long running scam of people receiving telephone calls from scammers posing as IRS representatives demanding payments for overdue taxes is being reported by the IRS.  In this new version of the scam, the intended victim is told by the scammer that two certified letters sent by the IRS to the intended victim were returned as undeliverable and that payment must be made immediately over the phone through providing the numbers from a prepaid debit card.  The phony IRS agent also tells the potential victim that the purchase of the prepaid debit card is linked to the IRS’ Electronic Federal Tax Payment System (EFTPS).

The EFTPS is a real system used by the IRS for payment of income taxes electronically over the Internet or by phone, but it does not require the use of prepaid debit cards and the systems are not linked.

Another major indication that this is a scam is that the caller also tells the intended victim not to contact their lawyer, tax preparer or their local IRS office until after the payment has been made.


By using a technique called “spoofing” a scammer scan trick your Caller ID into making it appear that the call is originating from the IRS.  Even though Congress foolishly recently authorized private collection agencies to contact taxpayers by phone in regard to overdue taxes, neither the IRS nor any of these private collection agencies will ever demand immediate payment over the phone by credit cards, prepaid debit cards, iTunes cards or wire transfers.

If you receive such a call you should hang up immediately.  If you think you owe money to the IRS, you should contact the IRS directly to deal with this matter.

Scam of the day – February 3, 2017 – IRS collection calls

One of the most common and effective scams is the phony telephone call purporting to be from the IRS telling you that you owe them money and must pay immediately or there will be dire repercussions.  Often the calls from these scammers will even appear on your Caller ID to have come from the IRS which can be done through a technique called “spoofing.”

There always was a simple way to know if a collection phone call was from the IRS or a scammer.  The IRS never initiates collection proceedings through phone calls so if you got a call, it was not from the IRS.

But that is changing this Spring.

Congress, in its infinite wisdom, is authorizing designated private collection companies to collect overdue taxes and contact people by phone in order to do so.  The National Taxpayer Advocate office, which is an office within the IRS estimates about 380,000 taxpayers’ accounts will be turned over to these collection agencies.

Having private collection companies attempt to collect overdue taxes on behalf of the IRS was done in past years, but was not cost effective.


If your account has been transferred to a private collection agency by the IRS, you will be notified by regular mail before you receive any phone call. So if you receive a call attempting to collect money from you for overdue taxes before receiving such a notice, you can be sure that the call is a scam. However, even if you account has been turned over to a collection agency by the IRS, you can never be sure when you are called on the phone, that the person calling you is really from one of the IRS authorized collection agencies so the best course of action is to tell them politely that you cannot be sure that they are who they say they  are and contact the IRS directly to straighten the matter out.

Complicating the matter is that while there are various tax forgiveness programs the IRS operates, these private collection agencies, who are paid on commission, are not required to tell you about these programs when they call, so you are always better off dealing with the IRS directly rather than through a collection agency.

Scam of the day – February 25, 2015 – IRS releases its list of “Dirty Dozen” tax scams for 2015

Recently the IRS issued its annual list of “Dirty Dozen” tax scams although many of these scams are not scams that cheat taxpayers, but rather scams the scammers attempt to perpetrate on the IRS in order to get large fraudulent refunds.  These frauds against the IRS include excessive claims for fuel credits, abusive tax shelters and offshore tax avoidance schemes.  Here at Scamicide, however, we focus on those scams that target innocent citizens rather than the IRS.  The three primary consumer tax scams on the IRS’ list are phone scams, phishing scams and inflated refund scams.

This has been a particularly big year for aggressive phone scams where people receive phone calls from people purporting to be IRS employees demanding immediate payments of purported overdo taxes by wired funds or prepaid money cards.  People receiving these calls are threatened with fines, arrest, deportation and loss of drivers’ licenses among other penalties unless there is immediate compliance with the caller’s demand.  This is a total scam.  The IRS will not initiate such communications with any taxpayer by phone.

The second scam involves phony emails or text messages that again, appear to come from the IRS demanding information or payments under various guises.  Again, the IRS will not communicate with taxpayers in this fashion, so you can be confident when you receive such a communication that it is a scam.

Finally, unscrupulous scammers posing as tax preparers may promise huge refunds and ask unwary taxpayers to sign blank returns that the scammer fills in with fraudulent information.  Often these phony tax preparers make initial contact through a social group, religious group or some other group of which you may be a member taking advantage of the high level of trust for people who share such affiliations.  This type of fraud is called affinity fraud.


The IRS will not initiate contact with anyone by telephone and even if your Caller ID indicates that the call is from the IRS, Caller ID can be fooled through a technique called “spoofing” to make it appear that the call has originated from the IRS when it has not.  In addition, the IRS will never demand that you wire in a payment or pay immediately by a prepaid money card.  Just hang up if you receive such a call.

Just as the IRS will not initiate contact with you by phone, it will also not initiate contact with you by email or text message.  Never provide personal information in response to an email until you have confirmed that the email or text message is legitimate.  In this case, you don’t even have to bother to verify the email or text message because the IRS will not communicate with you in this manner.  Also, don’t ever click on links or download attachments in emails or text messages unless you have confirmed that they are legitimate because often these links or attachments end up downloading malware on your computer or other device that steals your personal information and uses it to make you a victim of identity theft.

Finally, always check out the reputation and honesty of anyone you may use to prepare your taxes.  Never sign a blank form and remember my motto, “trust me, you can’t trust anyone.”  Merely because you may share a religious or social affiliation with someone does not make them trustworthy.  Just ask the people that trusted Bernie Madoff.

Scam of the day – October 19, 2012 – New IRS scam

Many of us pay our taxes online and many of us have a refund deposited electronically into our bank accounts.  It is a quick and efficient way to pay your taxes and get your refund safely.  However, scam artists are aware of this and are sending out phony emails purporting to be from the IRS telling their victims that their refund deposit failed and asking the potential victim to click on a link for the details of how to remedy the situation.  Of course, if you click on the link, what you will end up doing is downloading keystroke logging malware that will enable the scammer to steal all of the information from your computer.  Some of the notices are even followed up with another email telling you that it is a second notice and that your refund is being cancelled unless you click on the link to remedy the situation.  Don’t click on the link.


Never click on links unless you are positive that it is legitimate and even then you cannot be sure, if it is something being sent by a friend that they are not passing on something to you that they do not realize is infected.  In regard to this particular phishing scam, although the email looks legitimate, it does not include your name and the address line on the email  and indicates it was sent from an email address other than the IRS.  However, even if the email address appears to be from the IRS, it is easy to spoof or copy the address to make it appear that it is from the IRS.   The safe thing to do if you have any questions as to the legitimacy of such an email is to call or email the IRS.