IRS Issues Warning about New Email Scam Targeting Tax Professionals
The Internal Revenue Service today announced a new email scam from cybercriminals that target tax professionals. Using a two-stage process, this latest phishing scheme attempts to collect private data from tax payers.
In the first stage of the email, the criminals pose as a potential client looking for someone to prepare their taxes. The IRS says that, in some cases, these emails may appear on the level: they could come from a seemingly "legitimate sender or organization (perhaps a friend or colleague) because they also have been victimized." These emails state, "I need a preparer to file my taxes" and include several questions in an attempt to establish authenticity.
Responding triggers the second stage: a follow-up email containing either an embedded link or attached PDF. Clicking on either the email or PDF link collects the tax preparer's password and possibly other sensitive data.
If you receive one of these emails, the Security Summit has advice: "never respond to or click on a link in an unsolicited email or PDF attachment from an unknown sender." Cybercriminals use private information to impersonate taxpayers and file fraudulent returns so they can collect refund money; in past years, they have illegally claimed billions of dollars from the IRS.
Identity thieves have increasingly begun using stolen personal information to file fraudulent tax returns, so they can collect IRS-issued refunds. Time reported in 2014 that tax-related identity theft led to more than $5 billion dollars being stolen from the IRS.
In recent years, the IRS has become more adept at preventing fraud: IRS Criminal Investigation (CI) efforts contributed to the conviction of 2,000 identity thieves from 2013 to 2015; affidavits reporting identity theft dropped by 50% in 2016, as compared to 2015; and the number of fraudulent returns that were processed dropped by nearly 50% in 2016. Bringing taxpayers into the conversation, the agency hopes, will further improve those numbers.
The tax preparation industry consists of some 1.2 million paid professionals, according to US News and World Report, engaged in the preparation and filing of forms required by the federal, state and local governments. The industry generates $9 billion in revenue, and last year prepared more than 82 million individual income tax returns. The Bureau of Labor Statistics notes that industry growth is roughly 10 percent per year, consistent with the average of all industries.