Avoid These Common Tax Scams

Tax scams commonly involve fraudsters using deceptive tactics to gain your personal information and or money. According to The Kaplan group tax scams resulted in American’s losing over $5.7 million in 2025 alone with the number of reports quadrupling since 2020. Blue Ridge Bank is committed to keeping your financial information safe and providing you with information to protect yourself against tax fraud scams this year.

There are many different tax-related scams out there, but the overarching goal of the scam is to mislead you into providing them with your personal information or money. Often this looks like the scammer posing as an IRS employee to demand payment for an outstanding tax debt or advise you’re owed an unclaimed tax refund. Scammers may also pose as a representative of a charity or organization to pressure you to send money to an illegitimate charity or disaster relief by advising you to claim the donation on your taxes. Another common scam people fall victim to during tax time is “ghost preparers”.

The IRS will never:

Contact you about an unexpected refund or to gain your information to send you lump sum payments.
Call to demand immediate payment using a specific payment method such as a prepaid debit card, gift card, or wire transfer. Generally, the IRS will first mail a bill to any taxpayer who owes taxes.
Threaten to immediately bring in local police or other law-enforcement groups to have the taxpayer arrested for not paying or demanding payment without giving taxpayers the opportunity to question or appeal the amount owed.
Ask for online banking credentials, credit or debit card numbers over the phone.

How to Protect Yourself

1. Shred any paperwork not needed for tax preparation.

What to Shred. Checks from a credit card company offering low annual percentage rates for balance transfers and other pre-approved credit offers should be shredded upon receipt if you don't plan to use them. Once reconciled with corresponding accounts, ATM receipts, canceled checks, and pay stubs can all be shredded.

What to Keep. Hang on to monthly banking, brokerage account, and credit card statements. Compare the current statement to the previous statement. Once you've reviewed the statements and addressed any inaccuracies, you can shred them when the year-end statement arrives. Certain papers should be kept for life, including divorce and estate documents and annual retirement plan forms. Per IRS recommendation, keep filing tax returns that don't require additional payments for three years.

2. Go Digital. The best way to minimize year-end paperwork is to minimize paperwork in general. Whenever possible, opt out of credit card offers, sign up for e-Statements and online banking to eliminate the need for physical checks (as well as envelopes and stamps), monitor your financial accounts, and opt to get digital alerts when bills have arrived, payments are due or online purchases or transactions.

Tax returns can also be filed digitally on secure servers, and copies of the completed forms downloaded directly to a personal computer. Users can opt to have their Social Security number partially stricken from the download for additional security. Be wary of a slow-running computer or out-of-place pop-ups when filing taxes online.

3. Be suspicious of any phone calls or emails claiming to be from the IRS, even with the appropriate logos. According to the IRS website: "The IRS does not initiate contact with taxpayers by email to request personal or financial information. This includes any type of electronic communication, such as text messages and social media channels." Phishing can occur criminals use fake emails and websites of trusted organizations to coerce consumers into sharing personal information.

4. Keep an eye out for missing mail.Fraudsters look for monthly credit card statements, W-2s, tax refunds and other mail containing your financial information. If you don’t receive your W-2s, and your employer indicates they’ve been mailed, or it looks like it has been previously opened upon delivery, contact the IRS immediately.

IRS Imposter Phone Scams and What to Do if You Encounter One

Con artists make unsolicited calls claiming to be IRS officials. They demand that the victim pay a bogus tax bill. They convince the victim to send cash, usually through a wire transfer or a prepaid debit card or a gift card. They may also leave “urgent” callback requests through phone “robo-calls,” or send a phishing email.
Many phone scams use threats to intimidate and bully a victim into paying. They may even threaten to arrest, deport or revoke the driver’s license of their victim if they don’t get the money.
Scammers often alter caller ID numbers to make it look like the IRS or another agency is calling. The callers use IRS employee titles and fake badge numbers to appear legitimate. They may use the victim’s name, address, and other personal information to make the call sound official.
Aggressive and threatening phone calls by criminals impersonating IRS agents remain a major threat to taxpayers, but variations of the IRS impersonation scam continue year-round and they tend to peak when scammers find prime opportunities to strike.

What you can do if you get a call from an IRS imposter:

Do not give out any information. Keep your Social Security number and bank account information to yourself. Hang up immediately.
Contact the Treasury Inspector General for Tax Administration to report the call. Use their IRS Impersonation Scam Reporting web page here.
Report it to the Federal Trade Commission. Use the FTC Complaint Assistant on FTC.gov.

For those who owe taxes or think they do:

Call the IRS at 800-829-1040. IRS workers can help.

“Ghost Preparers”

These are individuals who charge taxpayers to prepare or assist in preparing your tax return, but do not include their PTIN (preparer tax identification number) or sign as a paid preparer as legally required for all legitimate tax professionals. They will often times complete the return, then print it out and advise you to sign and mail it into the IRS or file digitally refusing to sign it as the paid preparer, all to avoid any responsibility or connection to themselves.

Ghost preparers often gain clientele by promising huge tax refund amounts, which in most cases they achieve by illegally falsifying your income information and/or claiming illegitimate deductions to boost your refund amount.

How To Avoid Ghost Preparers:

Be wary of guarantees of unusually large refunds, as no legitimate preparer can promise a refund amount.
Review your full return before signing; ensure the preparer signed the return as the preparer including their PRIN, and never sign a blank or incomplete tax form
Question any income or deduction changes that do not reflect your actual financial information.
Avoid preparers who require cash-only payment, base their fee on your refund amount, or request your refund be deposited to any account other than your own.
Choose established, reputable tax professionals with verifiable credentials and business information.

What to do if you’re a victim of fraud

Taxpayers who suspect they've been victims of identity fraud should call the IRS Identity Theft department at 800-908-4490 with a copy of a police report, the completed IRS affidavit Form 14039, and state-issued identification. You'll find more information in the Taxpayer Guide to Identity Theft on the IRS website. You should also take the following steps below.

1. Discontinue all contact with the fraudster.

2. Contact Blue Ridge Bank at (888) 331-6521 and provide all details of the incident, including exactly what information you provided the fraudster.

3. Reset all credentials you provided the fraudster. (online banking, PIN numbers, email password, etc.)

4. Monitor your accounts for an unusual, unexpected, or unauthorized activity and report any fraudulent charges to BRB immediately.

5. If you have any concerns of identity theft, contact the IRS Identity Theft Department. (800-908-4490)

At Blue Ridge Bank, we work to keep your accounts safe and secure, whether you're accessing them online, through an ATM, mobile device, or in one of our branches. For more information on how to keep your personal information secure, visit our Identity Protection page.

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