WASHINGTON, D.C. — A word of caution issued by the Internal Revenue Service (IRS) and its Security Summit partners has signaled a crucial warning to tax professionals nationwide. As we enter the 2024 tax season, there has been a significant increase in “new client” scams. These crafty cyber swindles involve criminals posing as potential clients who claim to require assistance with tax preparations. The unsuspecting tax professionals’ personal information is stolen, laying the groundwork for fraudulent tax returns and other types of fraud.
The Anatomy of the Scams
Each year, tax season, which spans from January to April, becomes a hunting ground for cybercriminals. They are capitalizing on the surge of activity in the tax industry and disguising their malicious intent through seemingly innocent emails. This age-old tactic, known as phishing, has proven to be effective once again. The cybercriminals act as potential taxpayers in desperate need of help with their taxes. However, these email exchanges may contain links or attachments that, once clicked, lead to the theft of sensitive client data or the victim’s computer being infected with malware.
Spotting the Red Flags
The sophistication of these scams makes them even more menacing. Cybercriminals often use stolen email accounts to send these malicious emails and replicate previous email conversations to project an impression of authenticity. Better to be safe than sorry, tax professionals should familiarize themselves with the telltale signs:
- Choppy sentences and peculiar use of words
- Unsolicited emails seeking tax-related help
- Subject lines containing references to the current tax season
- Emails bundled with suspicious links or attachments
Guarding Against the Threat
Tax professionals, in a bid to safeguard their clients and themselves, ought to adopt a more pro-active, cautious approach:
- On guard with unexpected email pleas
- Refrain from clicking on links or opening attachments in suspicious emails
- Confirm the sender’s identity through other communication methods
- Enforce two-factor or multi-factor authentication for email accounts
Action Steps – Reporting and Resources
If, unfortunately, tax professionals fall prey to these scams or even experience data breaches, they should act swiftly:
- Forward phishing emails and other scams to the IRS at phishing@irs.gov
- Report monetary losses to the Treasury Inspector General for Tax Administration (TIGTA), Federal Trade Commission, and the Internet Crime Complaint Center
- Notify the local Stakeholder Liaison representative or law enforcement in the event of a data breach
- Use resources provided by the IRS, such as the Taxpayer Advocate Service and the IRS Criminal Investigation division
The Critical Importance of Awareness
The “new client” scams represent a significant risk to the tax professionals and their clients. Armed with stolen information and advanced tactics, these cybercriminals can commit identity theft and other forms of fraud. As we approach this tax season, it is paramount that tax professionals remain doubly cautious and step up their vigilance against phishing attempts and related scams.
A Concluding Warning
The IRS and its Security Summit partners are urging tax professionals to be prepared for the surge in “new client” scams as the 2024 filing season draws closer. Awareness of these cybercriminal tactics and adopting the necessary precautions can shield tax professionals and their clients from being victimized. Any suspicious emails or incidents should be reported promptly, a step critical in the fight against tax-related identity theft and ensuring the security of taxpayer information.
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