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10 Tax Scams SMBs Need To Watch Out For

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Scammers have become increasingly sophisticated in their tactics, making it crucial for SMBs to stay informed and vigilant. Every year, criminals and scam artists come up with new tactics to deceive unsuspecting small and medium-sized business owners and leaders. According to the IRS's annual 2023 Dirty Dozen list, tax fraud risks are not confined to tax season. This is why businesses must stay informed about evolving tax scams and understand how to minimize the possible impact on their operations. 10 Latest Tax Scams Targeting SMBs We previously wrote about 2022 tax scams targeting small and medium businesses. This article goes into 10 of the most prevalent business tax scams in 2023. Watch out for an upcoming article that shares practical tips you can follow to avoid falling victim to these schemes! 1. Business-Related W-2 Scams One of the most common tax scams targeting SMBs is the W-2 scam. Hackers use fake emails or text messages to trick payroll and human resources professionals into sharing sensitive tax information, such as employees' W-2 forms. Once cybercriminals access the W-2 forms, they file fake tax returns to claim refunds. 2. Employee Identification Number Scams Scammers target businesses applying for Employer Identification Numbers (EINs) by tricking them into signing up through fraudulent websites. EINs are required for various business accounts and tax filings. These scammers collect the taxpayer's personal information and may use it for identity theft.  3. IRS Impersonation Scams In an earlier blog post, we previously discussed phone and text tax scams from criminals impersonating the IRS, but this technique has only evolved and spread even further. These scammers often leave messages with phone numbers that are either non-functional or only work for a short period of time. They may even provide a fake IRS agent's name and badge number to appear more convincing. It is important to remember that the IRS will never initiate contact with …

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IRS Warns about 2022 Tax Scams

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Since the beginning of the pandemic, scammers have only gotten more creative. Let’s discuss some of the tax scams the IRS has recently warned taxpayers about. 2022 Tax Scams At the beginning of February 2022, the IRS published a news release urging taxpayers to stay vigilant and to watch out for these recent tax scams. Some of the big areas of interest this year include text message, email, and phone scams. There’s also been increasing unemployment fraud attempts. Here are some of the tax scams to look out for, and some tips and tricks for determining if a message is legitimate or fraudulent. Phone and Text Tax Scams If you receive a call from the IRS, you probably didn’t receive a call from the real IRS. The IRS doesn’t ever leave intimidating, urgent, or aggressive voicemails for taxpayers. One of the most common tax scams includes a phone call in which the recipient is told that if they don’t act immediately, they will be arrested. Many times, these calls are looking to instill fear and coerce individuals into giving them a credit card number or other information to settle debt quickly so they can avoid court or jail time. Many of the text message scams stemmed from phony requests for the sake of helping the recipient gain access to or confirm a stimulus payment. COVID pushed a lot of normally “unplugged” products, services, and processes into the online sector. That created more opportunities for fraudsters to take advantage of people who are unfamiliar with the latest technology-based updates that have been put in place for tax filing, direct deposits, and so much more. Unemployment Fraud The IRS also warned of unemployment fraud schemes that stemmed from organized crime circles. The victims of this tax scam would receive unemployment or other benefit payment notices sent from the IRS. These forms are filled out on the taxpayer’s behalf by a criminal looking to collect on benefits you never applied for or reported. If you receive …

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