Nearly 1 in 4 Americans affected by tax scams as new rules and AI deepfakes confuse filers — here are 5 traps to watch for and what to do instead

The problem is more widespread as fraudsters use sophisticated artificial intelligence tools to trick Americans into handing over their personal information or money.

But as the Wall Street Journal reports, this year, con artists are taking advantage of confusion around new tax rules under the Trump administration (2). WRAL News notes that fraudsters are extra motivated by larger refunds this year — with tax refunds up 14% according to the IRS (3).

“Fraudsters prey on people’s anxiety and confusion about filing their tax returns and what is legitimate,” said Jeremiah Barlow, chief solutions officer at Mercer Advisors, told the Wall Street Journal.

Here’s a list of the key tax scams to watch out for and how to protect yourself.

Top 5 common tax scams

According to McAfee, tax scams happen all year round even though they ramp up as tax season approaches. Here are five of the most common scams to watch for:

1. IRS impersonation scams

One of the most common scams involves fraudsters pretending to be the IRS or a tax agency.

The bad actors will attempt to reach out to potential victims through emails, texts or phone calls claiming you owe back taxes or that your refund needs verification. Some even use AI tools to create convincing voice calls or messages.

Conveying a sense of urgency, the scammers pressure victims to click on a link that will lead them to a fake website where they’re asked to enter sensitive information like their Social Security Number or banking details.

Once scammers have this personal information, they can file a fraudulent tax return and claim your refund.

2. Social media schemes

Scammers increasingly pose as tax experts on platforms like TikTok or Instagram, promising huge refunds or special tax credits that supposedly apply to everyone, getting people to claim credits they may not qualify for.

What’s in it for the fraudsters? They get a cut of the refund.

If the IRS flags the return, the taxpayer could be left facing audits, penalties or even criminal charges for filing inaccurate information.

3. ‘Ghost’ tax preparers

Another growing issue is unlicensed tax preparers who file returns for a fee but refuse to sign them.

So-called “ghost preparers” might invent income, exaggerate deductions or manipulate returns to boost refunds, but it leaves taxpayers responsible for any fraud once the return is filed.

The IRS says that legitimate preparers must have a Preparer Tax Identification Number (PTIN) and sign the return.

4. Tax debt relief scams

Scammers promise to settle unpaid IRS debt for much lower amounts than what’s owed, advertising guaranteed settlements.

In return, they charge large upfront fees using high-pressured sales taxes. Victims — already in debt to the government — are cheated out of that money.

The IRS does offer legitimate relief programs to people who owe back taxes like offers in compromise, but not everyone will qualify.

It’s another case of that adage: If it’s too good to be true, it probably is.

5. Fake charity schemes

Scammers sometimes pose as charities to collect donations they say will reduce your tax bill. Fraudsters may create websites or organizations with names similar to real nonprofits and then pressure taxpayers to donate quickly.

Watch out for red flags like asking for payment via gift cards, wire transfers or cryptocurrency, which are harder to trace.