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Scam Alert: Erroneous Refunds

Criminals have a new twist on an old scam. After stealing client data and filing fraudulent tax returns, criminals use the taxpayers' real bank accounts for the refund check deposit.

Thieves are then using various tactics to reclaim the refund from the taxpayers, and their versions of the scam may continue to evolve.

The IRS noted that the scam has now affected several thousand taxpayers and they are continuing to investigate leads.

The Tactics

1. Criminals pose as debt collection agency officials acting on behalf of the IRS.  They contact the taxpayers to say a refund was deposited in error, and they ask the taxpayers to forward the money to their collection agency.

2. Taxpayers who receive the erroneous refund get an automated call “from the IRS” threatening the taxpayer with criminal fraud charges, an arrest warrant and a “blacklisting” of their Social Security Number. The recorded call gives the taxpayer a case number and a telephone number to call to return the refund.

The IRS urges taxpayers to follow established procedures for returning an erroneous refund. Taxpayers should also contact their financial institution and their tax professional immediately.

Taxpayers who receive an erroneous refund should follow the steps outlined by Tax Topic Number 161 - Returning an Erroneous Refund at The tax topic contains full details, including mailing addresses should there be a need to return paper checks. 

Bradley H. Kearns, CPA,

Nathaniel L. Fissel, CPA, MST,

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