The Internal Revenue Service (IRS) has unveiled its 2025 Dirty Dozen list of tax scams, urging taxpayers and businesses to remain vigilant against schemes that jeopardize their financial and personal information. These scams often spike during tax season. However, fraudsters are active year-round, continuously seeking opportunities to steal money and sensitive data. These schemes can result in identity theft or lead taxpayers to falsely claim tax credits.
While not a legal document or official enforcement priority list, the Dirty Dozen initiative raises awareness and helps protect taxpayers from falling victim to tax-related fraud. Working alongside the Security Summit, Coalition Against Scam and Scheme Threats (CASST), and industry professionals, the IRS has helped prevent millions of identity theft cases and billions in refund fraud. This year’s list highlights the threats taxpayers may face in 2025.
Email Phishing Scams
The IRS continues to warn taxpayers about the rise in email and text scams designed to steal personal and financial information. Scammers often impersonate legitimate organizations, such as the IRS, state tax agencies, or tax software companies, to lure unsuspecting victims into sharing sensitive information that could lead to identity theft. These scams typically appear as unsolicited emails or text messages and fall into two categories:
Phishing: Fraudsters send emails pretending to be the IRS, using tactics such as promising fake tax refunds or threatening legal action for alleged tax fraud.
Smishing: Scammers send text or SMS messages with alarming phrases such as "Your account has been put on hold" or "Unusual Activity Detected" with a fake link to resolve the issue. Some texts also promise unexpected tax refunds to lure victims into clicking malicious links.
Always be cautious and avoid clicking on links or downloading attachments from unsolicited messages. These could secretly install malware or ransomware. The IRS provides resources to help taxpayers recognize and report phishing and smishing scams.
Bad Social Media Advice
Misleading tax advice on social media remains a growing threat. Social media platforms have become hotspots for users sharing false and deceptive tax tips, such as misusing forms to claim fake refunds or promoting other fraudulent schemes. The IRS and CASST caution taxpayers against falling victim to these scams and instead seek guidance from trusted sources, such as the IRS, licensed tax professionals, and reputable financial experts.
IRS Individual Online Account Help from Scammers
Scammers may pose as "helpful" third parties offering to assist with creating an IRS Individual Online Account. These fraudsters seek to steal personal information and may file fake tax returns to claim a large refund in the victim’s name. The IRS provides clear instructions on how to sign up safely.
Fake Charities
Bogus charities are a constant issue that can intensify when a crisis or natural disaster strikes. Scammers create fake organizations to exploit the public’s generosity, seeking money and personal information. Taxpayers may only claim a deduction on their federal tax return for charitable donations if itemized and made to an IRS-recognized tax-exempt organization.
False Fuel Tax Credit Claims
This scheme misleads taxpayers into believing they qualify for the Fuel Tax Credit, which is intended for off-highway business and farming use. Scammers encourage taxpayers to inflate refunds by falsely claiming the credit. The IRS has seen an increase in the promotion of filing refundable credits using Form 4136, Credit for Federal Tax Paid on Fuels. Taxpayers should verify eligibility before claiming this credit.
Credits for Sick Leave and Family Leave
This specialized credit was available only to self-employed individuals during 2020 and 2021. Yet, scammers are still encouraging its use. The IRS has encountered multiple cases where taxpayers use Form 7202, Credits for Sick Leave and Family Leave for Certain Self-Employed Individuals, to incorrectly claim the credit based on income earned as an employee instead of a self-employed individual.
Bogus Self-Employment Tax Credit
The “Self-Employment Tax Credit” is entirely fabricated. Yet, scammers continue to promote it on social media as a way for self-employed individuals and gig workers to receive large payments for the COVID-19 pandemic period. Taxpayers filing these claims are doing so at their own risk.
Improper Household Employment Taxes
Some taxpayers fabricate fictional household employees and file Schedule H (Form 1040), Household Employment Taxes, to fraudulently claim a refund based on non-existent sick and family medical leave wages.
Overstated Withholding Scam
In this scheme, fraudsters encourage individuals to falsely complete forms such as Form W-2, Wage and Tax Statement, or Form 1099-NEC electronically to secure a large refund based on inflated withholding amounts. Taxpayers should always ensure their returns are accurate and based on legitimate forms.
Misleading Offers in Compromise
The Offers in Compromise (OIC) program helps individuals settle federal tax debts when they cannot pay in full. However, scammers misrepresent this program, targeting individuals who do not qualify, sometimes costing taxpayers thousands of dollars. Taxpayers can check eligibility for free using the IRS Offer in Compromise Pre-Qualifier tool.
Ghost Tax Return Preparers
While most tax preparers offer excellent service, taxpayers should be cautious of dishonest professionals. Signs of a scam include preparers charging fees based on the size of the refund or refusing to sign the tax return.
New Client Scams and Spear Phishing
The IRS also warns tax professionals about "new client" scams, where cybercriminals impersonate potential clients to trick tax preparers into opening malicious attachments or URLs that compromise their systems and expose client data. Hacked email accounts are often used to send these deceptive messages.
A Baker’s Dirty Dozen: Beware of Other Abusive Schemes
The IRS also warns of many other fraudulent tax avoidance strategies. These may include various types of trusts, offshore schemes, and individual retirement arrangements.
Report Abusive Tax Schemes and Tax Return Preparers
As part of the Dirty Dozen awareness initiative, the IRS encourages individuals to report those promoting abusive tax schemes. To report an abusive tax scheme, individuals can use the online Form 14242 – Report Suspected Abusive Tax Promotions or Preparers, or mail/fax a completed Form 14242 PDF along with any supporting documents to the IRS Lead Development Center in the Office of Promoter Investigations.
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