IRS Targets ‘Ghost Preparers’ and Other Emerging Scams Aimed at Taxpayers

After a tax filing season that saw a growing number of scams, the IRS and several partners from the private and public sectors said they’re going to work together to combat fraud.

“We will do more to work closely together, share information faster, respond quickly to threats, and quickly alert the public to new and emerging threats,” IRS Commissioner Danny Werfel said in a Friday (Aug. 16) press release. “Our goal is to have a mass effect on this expanding problem that’s spread on social media and through bad actors.”

The effort will be led by a new task force convened by Werfel and named the Coalition Against Scam and Scheme Threats (CASST), according to the release.

Participants in the task force include federal and state tax agencies; software and financial companies; and national tax professional associations, the release said. More than 60 organizations from the private sector have signed on, either individually or as a member of a group.

Together, the participants will work on outreach and education focused on emerging scams; new approaches to identifying potentially fraudulent returns at the point of filing; and infrastructure improvements to protect consumers and tax systems, per the release.

Two growing scams were highlighted by the IRS in the release: taxpayers claiming credits for which they are not eligible and “ghost preparers” preparing taxes for a fee, not signing the tax return and leaving taxpayers at risk for inflated tax refunds claimed by the preparer.

“Numerous other scams and schemes continue to be seen circulating on social media and are highlighted through efforts including the annual IRS Dirty Dozen list and alerts from the Security Summit partners,” the IRS said in the release.

The new coalition grew out of the Security Summit and will be closely modeled on that project, per the release.

In July, the Security Summit urged tax professionals to heighten their awareness of indicators of identity theft, saying identity thieves are targeting tax professionals to access detailed client tax information for fraudulent tax filings.

“We continue to witness a relentless wave of email and related attacks intended to deceive tax professionals and gain unauthorized access to their confidential data,” Werfel said at the time. “These schemes can be sophisticated and intricate, appearing highly convincing to unsuspecting individuals.”