Global: IRS Targets ‘Ghost Preparers’ and Emerging Tax Scams with New Coalition

Following a tax filing season marked by an increase in scams, the Internal Revenue Service (IRS), in collaboration with various private and public sector partners, announced a concerted effort to combat tax fraud.

“We are committed to strengthening our collaboration, sharing information more rapidly, responding swiftly to threats, and alerting the public to new and emerging scams,” said IRS Commissioner Danny Werfel in a press release issued on Friday (Aug. 16). “Our objective is to make a significant impact on this growing problem, which has been exacerbated by the spread of misinformation on social media and the actions of bad actors.”

To spearhead this initiative, Werfel has established a new task force known as the Coalition Against Scam and Scheme Threats (CASST). This coalition includes federal and state tax agencies, software and financial companies, and national tax professional associations, with over 60 private sector organizations participating either individually or as part of a group.

The coalition’s efforts will focus on outreach and education to address emerging scams, developing new methods to identify potentially fraudulent tax returns at the point of filing, and enhancing infrastructure to better protect consumers and tax systems.

The IRS highlighted two particularly concerning scams: taxpayers claiming credits for which they are ineligible and “ghost preparers”—individuals who prepare taxes for a fee without signing the tax return, leaving taxpayers vulnerable to inflated refunds claimed by the preparer.

“Numerous other scams and schemes continue to circulate on social media and are regularly highlighted through initiatives like the annual IRS Dirty Dozen list and alerts from the Security Summit partners,” the IRS stated in the release.

The newly formed coalition builds on the foundation laid by the Security Summit and will closely follow its model.

In July, the Security Summit urged tax professionals to remain vigilant against identity theft, noting that cybercriminals are increasingly targeting tax professionals to gain access to detailed client tax information for fraudulent filings.

“We continue to see a relentless wave of email and related attacks designed to deceive tax professionals and gain unauthorized access to their confidential data,” Werfel remarked. “These schemes are often sophisticated and intricate, appearing highly convincing to those who are unsuspecting.”