IRS Teams With States and Tax Industry to Fight Scams

News August 16, 2024 at 03:19 PM
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Identity Theft

The Internal Revenue Service has entered into a joint effort with a number of U.S. states and stakeholders in the tax advisory industry to combat the growth of scams and schemes threatening taxpayers and tax systems.

The new task force will be called the Coalition Against Scam and Scheme Threats.

Convened at the request of IRS Commissioner Danny Werfel, the group will work to expand outreach and education about emerging scams. It will also develop approaches to identify potentially fraudulent returns at the point of filing and create infrastructure improvements to protect taxpayers — as well as federal, state and industry tax systems.

"Across the spectrum of the tax system, we've seen a rising tide of scams and schemes that try to exploit taxpayers and find gaps in government and industry defenses," Werfel said. "This new collaborative approach will allow the private and public sectors to throw our combined weight against this threat. "

Another objective, according to Werfel, is to share information faster and more quickly alert the public to emerging threats.

"Our goal is to have a mass effect on this expanding problem that's spread on social media and through bad actors," Werfel said.

In addition to the IRS, the coalition's nearly 60 participants include state tax agencies represented by the Federation of Tax Administrators, as well as the leading software and financial firms working in the tax space.

A number of national tax professional organizations are also participating, including the Council for Electronic Revenue Communication Advancement, the National Association of Computerized Tax Processors and the American Coalition for Taxpayer Rights.

Prior IRS reporting shows that there has been significantly increased fraud activity harming taxpayers, including scams focused on the Fuel Tax Credit, household employment taxes and the Sick and Family Leave Credit. There has also been a notable uptick in the filing of fraudulent returns.

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