Email Security Intelligence - Demystifying Tax Fraud: How to Avoid Falling Victim to Deceptive, Costly Scams This Tax Season

Cybercriminals take advantage of the stress of tax filing deadlines to impersonate the Internal Revenue Service (IRS) to steal money from taxpayers by implementing various social engineering attacks. Threat actors use tax season to obtain personal information, sensitive credentials, and tax returns using phishing, ransomware, online banking trojans, spyware, and fake IRS phone calls. Fake IRS calls managed to take over $63 billion from 12,000 victims in 2018.

Unfortunately, small businesses are the most vulnerable to tax fraud and email threats due to their inability to invest in effective email security strategies due to a lack of resources or an IT team to maintain services. As a result, cybercriminals exploit such weaknesses in small- and medium-sized businesses to harm their data and steal their money. Small Business Trends research stated that forty-three percent of cyberattacks target small businesses. This article will discuss tax scams, how to avoid and recognize fraud, and the solution Guardian Digital offers users who need to protect their servers.

How Do Tax Scams Work?

IRS tax scams typically come through phony emails that redirect users to websites with malicious code and attachments that install Remote Access Trojans (RATs) and malware. Such scams steal personal information to sell or use in account takeovers down the line. Fraudulent emails can use different tactics to attack taxpayers. 

In the most dangerous W2 scams, threat actors impersonate executives and leaders in a company to appear trustworthy when contacting human resources and payroll employees. Workers will hand over W2 forms and sensitive information that thieves can use to file fraudulent tax returns.

How Can I Recognize Tax Phishing, Impersonation, and Fraud?

At Guardian Digital, we quarantine emails with “red flags” that indicate fraud despite them appearing trustworthy and legitimate at first glance. Below, you will find one such message in the left part of the image. The subject line is vague, and the content has grammatical and spelling errors. Generic language like “tax collection agency” and “money laundry” typically indicate fraud. The emails contain malicious attachments that could leave user computers vulnerable to malware, ransomware, and data loss for the server and systems. 

How Can I Protect Myself Against IRS Scams and Tax Fraud?

Implement effective email security software into your server to combat email threats that could compromise your company and abuse the data they steal. Here are some of the best email security software practices you can implement immediately to mitigate your risks of facing a tax fraud attack:

• Avoid opening links and attachments from suspicious or unknown senders who may be using a fake, spoofed email address to act trustworthy when gathering your data.
• Keep an eye out for terms like “money laundry” and “tax collection agency” that the IRS would never use but that attacks write in to evade IRS spam filtering software.
• Read closely for spelling and grammar issues that cybercriminals intentionally place to sneak past email filters.
• Only speak with the IRS at 1-800-829-1040 when discussing your tax information. Any other phone number could be a scam. Hang up calls asking for data you have already sent to the IRS. If you are still determining whether the call was safe, call the above number to clarify.
• Report unsolicited IRS emails to This email address is being protected from spambots. You need JavaScript enabled to view it. so they can stay in the loop on the latest phishing emails attempting to inflict data loss on victims.
• Protect your accounts using Two-Factor Authentication (2FA) or Multi-Factor Authentication (MFA) and strong passwords as much as possible.

On top of these general preventative measures, you should keep in mind this list of interactions the IRS would never use in their exchanges with you and your business:

• Initiate contact to request sensitive information
• Ask you to send credit and debit information on the phone or through email
• Inform you of refund statuses through email
• Demand immediate payment without sending a bill
• Require a specific payment method
• Resist questioning regarding payment verification
• Threaten to have law enforcement arrest you for not paying

Protecting yourself using these methods can be efficient and trustworthy. However, such tactics involve constant monitoring, which can take up the time and energy you must devote to other daily tasks. Let’s review an option for cybersecurity platforms that can remove the stress of keeping your organization safe.

How Can Guardian Digital Help with Email Security?

Small- and medium-sized businesses need help finding the time to mitigate issues adequately. Therefore, they need a hands-off software solution to identify and quarantine emails effectively in real-time. Guardian Digital EnGarde Cloud Email Security focuses on cloud email security when offering an adaptive, threat-ready protection service with advanced threat detection for impersonation scams, credential theft, account takeovers, and wire fabrication. 

This defense-in-depth, collaborative, transparent approach to online safety is central-hosted, fully managed, and multi-layered to ensure complete email vigilance. Integrate EnGarde into your business’ email infrastructure so experts can provide 24/7/365 customer support services that provide the convenience and peace of mind you need to focus on your business.

Here are the key features of EnGarde Cloud Email Security protection:

• Prevent social engineering and impersonation attacks with advanced real-time intelligence techniques recognizing existing and emerging email threats.
• Neutralize email security issues with malware URL scanners and spam filtering that can prevent malicious attachments and links in RTF, batch, and VBS files from entering your inbox. 
• Ensure your company is safe with complete, end-to-end email protection through advanced encryption and sender authentication protocols.
• Increase employee availability and simplify deployment with a scalable, customizable cloud-based system.
• Rest easy knowing you have 24/7/365 customer support to notify you of any risk.

Speak with a Guardian Digital Security Expert today to see how your company can seek email protection with EnGarde.

Keep Learning About Tax Fraud

As tax season approaches, understanding your risk with tax fraud can help you mitigate risks as much as possible. Know how to detect email threats that impersonate the IRS so that you can prevent and stop problems before they can cause harm. EnGarde is a comprehensive, fully managed business email security solution that mitigates email risks, including tax fraud. Consider subscribing to our Behind the Shield newsletter so you can stay informed on how to improve your security posture and stay up-to-date on web and email security tactics.