Tax scams can start with a message about a refund, a promise from a preparer, or a return filed using someone else’s identity. The IRS screens returns for signs of identity theft, but its filters can also flag legitimate filings, and a flagged return may take a long time to resolve. A few warning signs can help taxpayers pause before sharing information or signing a return.
- An unexpected refund message: The FTC warns that texts and emails claiming to be about a tax refund can be scams. Treat an unexpected message as a reason to verify through an official agency channel, not as proof that a refund is waiting.
- A preparer promising a big refund: No preparer can know the correct refund before reviewing a taxpayer’s financial information. Promises of guaranteed or unusually large refunds deserve scrutiny.
- A return with no preparer signature: A so-called ghost preparer may prepare and file a return, charge a fee, and refuse to sign it as the paid preparer. The taxpayer’s name remains on the return.
- Ask whether the preparer will sign the return as the paid preparer.
- Ask how the fee is calculated, and be cautious if it depends on the size of the refund.
- Confirm where the refund will be sent. A request to deposit it into the preparer’s own account is a warning sign.
How the IRS screens for refund fraud
The IRS uses identity theft filters to screen returns before issuing refunds. The filters look for characteristics associated with known or emerging fraud schemes, and the agency adjusts the criteria as risks change. According to reporting on a Treasury inspector general audit, the filters selected about 7.5 million individual returns over the two-year period examined. The IRS reported stopping about $7 billion in fraudulent refunds in calendar years 2024 and 2025 using these filters. The audit coverage also describes the limits of the system.
A filter is a screening tool, not a final finding that a taxpayer committed fraud. Legitimate returns can be flagged, including when the IRS changes its criteria to catch new patterns. The same reporting says the IRS ended fiscal 2025 with 316,000 unresolved identity theft cases. The National Taxpayer Advocate called the nearly two-year average resolution time unacceptably long. TIGTA attributed $124.2 million in refund interest during fiscal years 2023 through 2025 to delays in resolving identity theft cases.
Why ghost preparers can leave taxpayers exposed
A paid preparer who refuses to sign a return leaves the taxpayer without the basic record of who prepared it. Some ghost preparers may also inflate deductions or claim credits that do not belong on the return to make the refund appear larger. A TIGTA report linked ghost preparers to $179 million in potentially fraudulent refund claims over two years, according to coverage of identity theft and fraud findings.
If the IRS later finds false or incorrect claims, the taxpayer may face a repayment demand or penalties, even if a preparer handled the paperwork. That makes it important to review a return before it is filed and keep a copy of what was submitted. The California Tax Education Council describes ghost preparers as a recurring tax scam and lists refusal to sign, refund-based fees, and requests to route a refund through the preparer’s account as warning signs. Its preparer guidance and verification resources apply to California, not necessarily to other states.
Verify the person handling your return
Before handing over tax documents, ask direct questions about the preparer’s role, the fee, and the refund destination. A professional should be willing to identify themselves on the return as the paid preparer. Be wary of advertisements that guarantee a refund or claim that a large refund is assured before the preparer has reviewed the relevant information.
California residents can use CTEC’s Find/Verify a Preparer search and its listings of preparer bond claims and disciplinary actions. Rules and registration systems differ by state, and the sources reviewed here do not provide a nationwide directory or explain each state’s requirements. Readers outside California can check their state’s official tax or professional licensing resources for applicable rules.
Fake messages change with the audience
The FTC has warned about texts and emails claiming to concern a tax refund. The available alert does not provide enough detail to establish a complete checklist of message features, so avoid relying on spelling, logos, or other surface clues alone. Instead, do not click a link or reply simply because a message mentions a refund. Check the claim through an official agency website or another verified contact method. The FTC alert gives the agency’s warning.
Fraud attempts can be tailored to particular groups. The IRS has warned about a fake compliance portal that directs digital asset holders to a bogus site. That example is a reminder that a message can borrow tax-related language to appear relevant to its recipient. The IRS maintains official guidance on recognizing tax scams and fraud, which readers can consult when a message or request is unclear.
What these warnings do not answer
The reports and alerts summarized here do not lay out a full response plan for someone who suspects a fraudulent return has already been filed in their name. They also do not explain how to set up an IRS Identity Protection PIN, how to protect a Social Security number, or which steps to take with credit reporting agencies after suspected identity theft. This article is not a substitute for that guidance.
If a situation is already underway, use the current official instructions from the IRS and FTC, and consider seeking help from a qualified tax professional for questions about an individual return. Agency procedures can change, and a message that appears official should still be checked through a channel found independently rather than through contact details or links in the message itself.
Please seek a professional. This article is general information, not financial, tax or insurance advice. Please seek a licensed financial, tax or insurance professional about your own situation.
