NEWS from the IRS

Marc J. Zine
Senior Stakehold Liaison - IRS
Tax Professional & Industry Organizations 
Phone 916-974-5281
Fax 877-477-8639
[email protected]
www.irs.gov/newsroom

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Click here to download: IRS Tax Forum Fact Sheet: Identify Theft Information for Tax Professionals

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Franchise Tax Board: February 2018 Newsletter


This Just In!
2018 Dirty Dozen

  1. Phishing Schemes Make IRS ‘Dirty Dozen’ List of Tax Scams for 2018; Individuals, Businesses, Tax Pros Urged to Remain Vigilant
    IR-2018-39, March 5, 2018 — Following continuing threats to taxpayers, the Internal Revenue Service today listed email “phishing” schemes as a top filing season concern and part of the annual listing of the “Dirty Dozen” tax scams for 2018.
  1. Phone Scams Pose Serious Threat; Remain on IRS ‘Dirty Dozen’ List of Tax Scams
    IR-2018-40, March 6, 2018 — The IRS reminded taxpayers to be careful with continuing aggressive phone scams as criminals pose as IRS agents in hopes of stealing money.
  1. Despite Major Progress, Identity Theft Still on IRS ‘Dirty Dozen’ Tax Scams List
    IR-2018-42, Mar. 7, 2018 — Even though reports of tax-related identity theft have declined markedly in recent years, the Internal Revenue Service warns that this practice is still widespread and remains serious enough to earn a spot on the agency’s annual “Dirty Dozen” list of tax scams.
  1. Tax Return Preparer Fraud Ranks on 2018 ‘Dirty Dozen’: Taxpayers Urged to Choose Reputable Tax Preparers
    IR-2018-45, March 8, 2018 — With more than half of the nation's taxpayers relying on someone else to prepare their tax return, the IRS reminded consumers to be on the lookout for unscrupulous tax preparers looking to make a fast buck from honest people seeking tax assistance.
  1. Fake charities make 2018 ‘Dirty Dozen’ list; taxpayers should be alert to scams involving disasters, worthwhile causes
    IR-2018-47, March 9, 2018 — The IRS today warned taxpayers against scam groups masquerading as charitable organizations, luring people to make donations to groups or causes that don't actually qualify for a tax deduction.
  1. Taxpayers alerted against falsely inflated refunds in ‘Dirty Dozen’ list; Seniors, many others at risk
  1. IRS ‘Dirty Dozen’ list of tax scams for 2018 contains warning to avoid improper claims for business credits
    IR-2018-49, March 13, 2018 — The IRS today warned that taxpayers should avoid making improper claims for business credits, a common scam used by unscrupulous tax preparers.
  1. Falsely padding deductions highlighted in IRS 2018 ‘Dirty Dozen’ tax scams
    IR-2018-54, March 14, 2018 — As part of the “Dirty Dozen” list of tax scams, the IRS today warned taxpayers to avoid falsely inflating deductions or expenses on tax returns.
  1. Falsified income, fake Forms 1099 part of IRS ‘Dirty Dozen’
    IR-2018-55, March 15, 2018  — As part of this year’s “Dirty Dozen” list of tax scams, the IRS warned taxpayers to be on the lookout for schemes that falsify income, including elaborate ruses involving bogus Forms 1099.
  1. IRS warns against frivolous tax arguments; Part of ‘Dirty Dozen’ scams list
    IR-2018-58, March 16, 2018 — The IRS today continued releasing the 2018 list of “Dirty Dozen” tax scams with a warning to taxpayers about using frivolous tax arguments to avoid paying taxes.
  1. IRS 2018 ‘Dirty Dozen’ tax scams: Abusive tax shelters make the list
    IR-2018-62, March 19, 2018 — The IRS today warned taxpayers to be wary of abusive tax shelters, which remain on the "Dirty Dozen” tax scams.
  1. “Offshore Avoidance” news release has not yet been posted to the IRS Newsroom at this time, but can be downloaded here.

Posted 2.23.2018

Three Popular Tax Benefits Retroactively Renewed for 2017; IRS Ready to Accept Returns Claiming These Benefits; e-file for Fastest Refunds

Posted 2.8.2018
Key IRS Identity Theft Indicators Continue Dramatic Decline in 2017; Security Summit Marks 2017 Progress Against Identify Theft ~ HOWEVER:

Statement by H&R Block on the Security Summit Success
Feb. 8, 2018

“While the incidents of stolen identity refund fraud have gone down significantly, we can never let our guard down.  The fraudsters are adaptive, and the work of the Security Summit is critical to our ongoing efforts to better protect taxpayers,” said Kathy Pickering, vice president of regulatory affairs and executive director of H&R Block’s The Tax Institute.


Public Announcements

The following Pubic Announcements have been archived below:

IRS: Remote Access Takeover - Click here to read.
IRS: W2 Email Scams - Click here to read.

IR-2017-127, Aug.8, 2017  

WASHINGTON – The Internal Revenue Service, state tax agencies and the tax industry today reminded tax professionals that their entire digital network could be at risk for remote takeover by . Such a takeover could lead to fraudulent tax filings and damage to their clients. 

Increasing awareness about remote takeovers are a part of the“Don’t Take the Bait” campaign, a 10-part series aimed at tax professionals. The IRS, state tax agencies and the tax industry, working together as the Security Summit, urge practitioners to learn to protect themselves from remote takeovers. This is part of the ongoing Protect Your Clients; Protect Yourself effort.   

“This is another emerging threat to tax professionals that the IRS has seen on the rise,” IRS Commissioner John Koskinen said. “A remote takeover can be devastating to practitioners’ business as well as to the taxpayers they serve. It’s critical for people to take steps to understand and prevent these security threats before it’s too late.”  

A remote attack targets an individual computer or network as the cyber criminal exploits weaknesses in security settings to access the devices. Another line of attack uses malware to download malicious code that gives the criminals access to the network. Especially vulnerable are wireless networks, including mobile phones, modems, and router devices, printers, fax machines and televisions that retain their factory-issued password settings. Sometimes, these devices have no protection at all.  

There are multiple ways that can gain control of computers and other devices. Phishing emails with attachments can easily download malware that, when opened, give the criminal remote control of a computer.  

also can deploy certain tools that allow them to identify the location of and get access to unprotected wireless devices. For example, a printer with a factory-issued password can easily be accessed, and the criminals can see tax return information stored in its memory.  

The IRS urges tax profession also take the following steps to help protect themselves from remote takeovers:  

  • Educate staff members about the dangers of phishing scams, which can be in the form of emails, texts and calls, as well as the threat posed by remote access attacks;
  • Use strong security software, set it to update automatically and run a periodic security “deep scan” to search for viruses and malware;
  • Identify and assess wireless devices connected to the network, including mobile phones, computers, printers, fax machines, routers, modems and televisions. Replace factory password settings with strong passwords.
  • Strengthen passwords for devices and for software access.Make sure passwords are a minimum of eight digits (more is better) with a mix of numbers, letters and special characters;
  • Be alert for phishing scams: do not click on links or open attachments from unknown, unsolicited or suspicious senders;
  • Review any software that employees use to remotely access the network as well as those used by IT support vendors to remotely troubleshoot technical problems. Remote access software is a potential target for bad actors to gain entry and take control of a machine. Disable remote access software until it is needed. 

Additional IRS Resources: 


W-2 Email Scam

IR-2017-130, Aug.15, 2017

WASHINGTON – The IRS, state tax agencies and the tax industry today urged tax professionals and businesses to beware of a recent increase in email scams targeting employee Forms W-2.  

The W-2 scam – called a business email compromise or BEC – is one of the most dangerous phishing email schemes trending nationwide from a tax administration perspective. The IRS saw a sharp increase in the number of incidents and victims during the 2017 filing season.

 Increasing awareness about business email compromises is part of the“Don’t Take the Bait” campaign, a 10-part series aimed at tax professionals. The IRS, state tax agencies and the tax industry, working together as the Security Summit, urge practitioners to learn to protect themselves and their clients from BEC scams. This is part of the ongoing Protect Your Clients; Protect Yourself effort. 

A business email compromise occurs when a cyber criminal is able to “spoof” or impersonate a company or organization executive’s email address and target a payroll, financial or human resources employee with a request.For example, fraudsters will try to trick an employee to transfer funds into a specified account or request a list of all employees and their Forms W-2.

“These are incredibly tricky schemes that can be devastating to a tax professional or business,” said IRS Commissioner John Koskinen. “ target people with access to sensitive information, and they cleverly disguise their effort through an official-looking email request.”

The Federal Bureau of Investigation reported earlier this year that there has been a 1,300 percent increase in identified losses – with more than $3 billion in wire transfers – since January 2015. The FBI found that the culprits behind these scams are national and international organized crime groups who have targeted businesses and organizations in all 50 states and 100 countries worldwide.

During the 2016 filing season, the IRS first warned businesses that the scam had migrated to tax administration and scammers were using business email compromise tactics to obtain employees’ Forms W-2. The criminals were immediately filing fraudulent tax returns that could mirror the actual income received by employees – making the fraud more difficult to detect.

In 2017, the IRS saw the number of businesses, public schools, universities, tribal governments and nonprofits victimized by the W-2 scam increase to 200 from 50 in 2016. Those 200 victims translated into several hundred thousand employees whose sensitive data was stolen. In some cases, the criminals requested both the W-2 information and a wire transfer.

The Form W-2 contains the employee’s name, address, Social Security number, income and withholdings. That information was used to file fraudulent tax returns, and it can be posted for sale on the Dark Net, where criminals also seek to profit fromthese thefts.

If the business or organization victimized by these attacks notifies the IRS, the IRS can take steps to help prevent employees from being victims of tax-related identity theft. However, because of the nature of these scams, many businesses and organizations did not realize for days, weeks or months that they had been scammed.

The IRS established a special email notification address specifically for businesses and organizations to report W-2 thefts: [email protected]. Be sure to include “W-2 scam” in the subject line and information about a point of contact in the body of the email. Businesses and organizations that receive a suspect email but do not fall victim to the scam can forward it to the BEC to [email protected], again with “W-2 scam” in the subject line.

 Protecting Clients and Businesses from BECs

The IRS urges tax professionals to both beware of business email compromises as a threat to their own systems and to educate their clients about the existence of BEC scams.Employers, including tax practitioners, should review their policies for sending sensitive data such as W-2s or making wire transfers based solely on an email request.

Tax professionals should consider taking these steps:

  • Confirm requests for Forms W-2, wire transfers or any sensitive data exchanges verbally, using previously-known telephone numbers, not telephone numbers listed in the email.
  • Verify requests for location changes in vendor payments and require a secondary sign-off by company personnel.
  • Educate employees about this scam, particularly those with access to sensitive data such as W-2s or with authorization to make wire transfers.
  • Consult with an IT professional and follow these FBI recommended safeguards:

o   Create intrusion detection system rules that flag e-mails with extensions that are similar to company email. For example, legitimate e-mail of abc_company.com would flag fraudulent email of abc-company.com.

o   Create an email rule to flag email communications where the “reply” email address is different from the “from” email address shown.

o   Color code virtual correspondence so emails from employee/internal accounts are one color and emails from non-employee/external accounts are another.