What to Do If You Get a Call From the IRS—Is It a Scam?
The IRS won't call you out of the blue
Maybe the letters "IRS" turn up on your caller ID, or you might pick up the phone blindly and the voice on the other end of the line says it's Joe Smith calling from the Internal Revenue Service. Hard as it might be to prevent it, you shouldn't panic. There's a very strong chance that the call isn't legitimate.
The Treasury Inspector General for Tax Administration (TIGTA) reports that almost 13,000 taxpayers fell victim to IRS phone scams between 2013 and 2018, paying out in excess of $63 million to fraudsters.
Your first line of defense should be understanding how these scams work so you can identify one when it happens. And you have to know what to do if it happens to you. The most common time for scams is during and right after tax filing season, but they can occur all year.
Your First Clue That the Call Is a Scam
Ask yourself one very important question before you answer the call. Have you received any written communications from the IRS via the U.S. Postal Service in recent months? If the answer is no, the call you're receiving is a scam. It's that plain and simple.
The IRS never calls taxpayers out of the blue without first sending a notice to tip you off that you owe money or that something else is amiss, and it won't do it via email or text message. If your ringing, dinging phone is the first contact you've had, it's not for real.
Of course, it's possible that your mail hasn't caught up with you yet if you've recently moved. You'll still want to ignore the ringing phone in this case, but call the IRS directly to find out if there's a problem.
How the Scam Works
There's usually more than one type of scam going around, but some are more widely used than others and most share some common themes.
One approach is that the caller will claim to be from the IRS and tell you that you owe taxes and that you must pay using a prepaid debit card or by wire transfer. Really? Think about this. The IRS offers a bona fide website called Direct Pay where you can just sign on, prove your identity by offering some information, and submit an electronic check. What in the world would the IRS do with a prepaid debit card? The requested method of payment can be a surefire clue that the caller is not on the up-and-up and you're being scammed.
If you did receive a letter or notice because you legitimately owe a tax debt, it should have explained all your options for paying by check or for setting up an installment agreement. IRS agents do not take credit card or debit card numbers over the phone.
Variations on the Theme
Scammers often threaten those who refuse to pay with arrest, deportation, or loss of their businesses, homes, or driver's license, but it just doesn't happen this way, at least not without due process. You'll receive lots and lots of written communications from the IRS first telling you that you're in trouble or that you must appear in tax court.
If you do owe taxes and have ignored numerous previous notices from the IRS, it's entirely possible that the federal government can and will place a tax levy against your wages, bank account, or tangible property. What the IRS won't do is send someone to your door with handcuffs unless yours is a particularly egregious tax situation and all these efforts have failed—and never simply because you owe money. Prison is reserved for issues of tax fraud, failing to file numerous returns, and otherwise cheating.
Scammers Can Be Wiley
Even knowing all this, you might have doubts because these scammers are pretty good at their games. They do their homework before calling you so they appear to be as legitimate on several levels. They'll offer an IRS "badge number," although it won't be real. The scammer might know the last four digits of your Social Security number, although in most cases he would be hard-pressed to give the first five numbers.
And yes, scammers can arrange for your caller ID to tell you that the IRS is calling. You might receive emails first—but again, the IRS always contacts taxpayers initially by U.S. mail, never by email, so this is another clue.
The IRS has reported a 2019 scam in which caller IDs report that the caller is from the Taxpayer Advocate Service (TAS). The TAS is real and has genuinely helped multitudes of taxpayers, but they won't call you out of the blue, either.
If you're a tough sell and make it clear that you know you're being scammed, you might next receive a call from your local police department or your state's department of motor vehicles, telling you that the IRS has notified them that you owe taxes and you must pay up now. Some scammers will even take this approach from the start. Hang up and call your police department or DMV. You'll find out that no one there has called you, at least not about a tax debt.
How to Protect Yourself
The TIGTA provides the following tips for how to deal with this type of telephone scam:
- If you owe federal taxes or you think you might owe taxes, hang up and call the IRS at 800-829-1040. IRS workers can help you with your payment questions. Do not give the caller any personal information.
- If you're sure you don't owe taxes, call and report the incident to TIGTA at 800-366-4484.
- You can also visit the TIGTA website and report the incident using the "IRS Impersonation Scam Reporting" option.
- You can file a complaint with the Federal Trade Commission at www.FTC.gov using the "FTC Complaint Assistant" option on the website. Add "IRS Telephone Scam" to the comments in your complaint.
Exercise vigilance. Contact the IRS, or ask your tax professional to contact the IRS for you, but do not deal with someone calling you out of the blue demanding money.