Viral Tax Advice and Fake Credits: Too-Good-to-Be-True

This is the second installment in our tax scam awareness series. In the February post, we covered IRS impersonation scams and digital deception. This month, we’re focusing on a different threat: misinformation spreading through familiar online platforms such as social media.

This time of year, social media feeds are flooded with “tax hacks” promising massive refunds, secret credits, or loopholes the IRS “doesn’t want you to know about.” Unfortunately, many of these claims are flat-out wrong, and relying on them can put you at serious risk. If financial advice sounds “too-good-to-be-true,” then it is likely that the advice is a scam.

The IRS continues to see a rise in fraudulent filings involving bad tax advice on social media involving tax credits such as: fake fuel tax credits, fake sick leave credits, and fake self-employed tax credits. It is better to verify your eligibility for tax deductions and credits by reading the IRS instructions for Form 1040 or by contacting a reputable tax preparer.

These schemes aim to convince you that temporary or limited credits that may have been created during the pandemic still apply universally, or that you qualify when you actually don’t. The result? An inflated refund could trigger an audit, repayment demands, significant penalties, and interest.

If you claimed a tax credit based on something you saw online and are now receiving audit or penalty letters from IRS, now is the time to seek help. Attorney Patricia Carbone works with taxpayers who have made honest mistakes after relying on misleading advice and need experienced representation to resolve the fallout.