1. AI Can Help, But It Can’t Replace a CPA

Many people are beginning to turn to AI for quick answers or guidance. The truth is, when it comes to tax-related scenarios, almost every tax question comes with an “it depends” answer. Keep in mind that AI tools do not have the full context of your finances, state rules, or unique situations. Always review AI-generated advice with a human tax professional. Your CPA can catch nuances AI might miss and ensure your tax return is accurate.

2. Protect Your Personal Information (PII)

Never share sensitive details—like Social Security numbers, account numbers, or tax documents—with online chatbots or AI tools. In the event of a data breach, cybercriminals could exploit this data. Be cautious and always use secure methods to communicate with your tax advisor or financial institutions.

3. Watch Out for AI-Driven Scams

Scammers are increasingly using AI to create sophisticated phishing attempts. According to a recent Washington Post report, scammers are utilizing AI to generate deepfake voices, realistic scripts, and vishing (voice phishing) calls that impersonate IRS agents or other officials. They may claim you owe taxes or offer fake “resolution services.”

Tips to stay safe:

• The IRS will never call or text demanding immediate payment or ask for gift cards.
• Hang up on unsolicited calls and do not click links in unexpected messages.
• Forward suspicious emails to phishing@irs.gov and delete them.
• Verify any tax-related communication with your CPA or directly with the IRS.

4. Use AI Wisely

AI can help with general research, organizing financial documents, or estimating taxes… but it’s a starting point, not a final answer. Combine AI insights with professional guidance for a safe, effective tax season.

How Alloy Silverstein Can Help

At Alloy Silverstein, our CPAs stay ahead of tax law changes and emerging threats, including AI-driven scams. We guide clients safely through tax season, answer your questions, and help ensure your filings are accurate and secure.

Contact us today to discuss your tax situation and plan confidently this season.

The post AI in Tax Season: Risks, Scams, and How to Protect Your Data appeared first on Alloy Silverstein.

Many of these scams surface during filing season, but they can occur at any point throughout the year. Alloy Silverstein’s tax advisors often see schemes impact well-intentioned taxpayers who simply did not know what to look for.

Below are some of the most common tax-related scams and fraud attempts to be aware of this season.

Phishing emails and text message scams

Scammers often impersonate the IRS, state tax agencies, or tax software companies through emails and text messages. These messages may promise unexpected refunds or warn of account issues, audits, or penalties in an attempt to create urgency.

The IRS does not initiate contact by email or text. Never click on links or open attachments from unsolicited messages claiming to be tax-related.

Misleading tax advice on social media

Incorrect tax advice continues to circulate on social media platforms, encouraging people to misuse tax forms or claim credits they are not eligible for. Following this advice can result in delayed refunds, IRS notices, penalties, or identity theft. Always verify tax guidance with a qualified tax professional before taking action.

Scams involving IRS online accounts

Fraudsters may offer to help taxpayers set up or access their IRS online accounts. These offers are often attempts to gather personal information and file fraudulent returns in someone else’s name. The IRS provides guidance directly, and third-party assistance is not required to create an account.

Fake charities

Scam charities frequently appear after natural disasters or high-profile events, taking advantage of people’s generosity. These organizations may request donations or personal information that can later be used for identity theft. Only donations to IRS-recognized charitable organizations are eligible for tax deductions.

Improper tax credit claims

Taxpayers are sometimes encouraged to claim credits they do not qualify for, including fuel-related credits, pandemic-era sick and family leave credits, or credits that do not exist at all. Improperly claiming credits can lead to refund delays, IRS reviews, repayment of funds, and penalties. When in doubt, ask before filing.

Overstated income or withholding schemes

Some scams encourage taxpayers to fabricate income or withholding amounts on Forms W-2 or 1099 to generate larger refunds. These returns are often flagged, and refunds may be held while the IRS investigates. Tax returns should always be filed using legitimate documents issued by employers or payers.

Unreliable or unethical tax preparers

Be cautious of preparers who base their fees on refund amounts, refuse to sign returns, or ask you to sign blank or incomplete forms. These are red flags that can expose you to financial and legal risk. Working with a reputable tax professional helps ensure your return is accurate and compliant.

Business and email-based tax scams

Businesses and tax professionals are frequently targeted by phishing emails disguised as new client inquiries or vendor communications. These messages may include malicious links or attachments designed to access sensitive data. Always verify unexpected requests and be cautious before sharing financial or tax information.

Stay Alert: Warning signs to watch for

Scammers often try to create urgency or pressure to get you to act quickly. Some common warning signs include:

• A big payday – If it sounds too good to be true, it probably is. Be cautious of social media posts or advice that encourage lying on tax forms or misrepresenting credits.
• Demands or threats – Impersonators may threaten arrest, deportation, or demand immediate payment. They do not allow you to question or appeal the amount owed.
• Suspicious website links – Odd, misspelled, or unofficial links can take you to harmful sites instead of IRS.gov. Always navigate directly to official websites.

Being aware of these red flags is one of the simplest ways to protect yourself from fraud.

Scammers also rely on urgency and confusion. Taking a moment to verify requests, confirm sources, and ask questions can help prevent costly mistakes. When something does not feel right, it is always better to pause and check before responding.

How Alloy Silverstein can help

At Alloy Silverstein, our CPAs and tax advisors help individuals and businesses navigate tax season with clarity and confidence. If you receive a suspicious notice, have questions about tax credits, or want a second set of eyes on your return, our team is here to help you file accurately and protect your financial information.

The post Tax Season Scams to Watch For This Year appeared first on Alloy Silverstein.

They are back once again, this time alerting taxpayers that over $162 million in penalties have been imposed due to fraudulent or frivolous tax returns as a result of bad actors online.

Warning from the IRS: Be Cautious of Social Media Tax Claims

Since 2022, the IRS has seen an uptick in false refund claims, especially with the Sick and Family Leave Credit as well as the Fuel Tax Credit. Now that there is a new tax law in play, taxpayers are urged to be even more cautious around the new information circulating online. Whether or not a taxpayer is intentionally deceiving the IRS with unqualified refund claims, they are still responsible for the accuracy of their tax return and, as a result, can be subject to penalties up to $5,000.

How to Safely Engage in Social Media

Not every tax video online is bad or at fault. Due your due diligence and follow up on the advice being presented. Also make sure to gauge the credentials and credibility of the speaker or influencer. If a tip sounds too good to be true, it likely is.

Keep these tips in mind:

1. Taxes are complex. The information could be factual, but tax planning is very situational. Just because the advice applies to one individual or business, does not mean it’s eligible or applicable to everyone. Consult with your
2. Consider the source and beware of promissory statements and guarantees. If you follow financial “professionals” in your video feed, know that FINRA and the SIPC have many restrictions for licensed professionals. Most are not even allowed to provide advice on social media, and they definitely cannot make performance guarantees. So, is the source actually a professional?

Signs of a Viral Tax Scam on Social Media

• Influencer posts or videos claiming “everyone qualifies” for certain tax credits.
• Promises of an “easy” or “fast” tax refund with little to no documentation required.
• Instructions to file amended tax returns, even if you *did not* originally qualify.
• Encouragement to ignore IRS letters or respond with false information.

Repercussions of Falling For a Scam  (whether intentional or not)

• Delayed and/or denied refunds.
• Up to $5,000 in civil penalties for filing a frivolous or fraudulent tax return.
• Increased risk of IRS audits, examinations, and enforcement action.

What Should Taxpayers Do if they are a Scam/Fraud Victim?

• Amend the tax return in question as soon as possible using Form 1040-X.
• Respond quickly to any IRS letters or notices.
• Seek help from a reputable tax professional or the IRS’s resources at IRS.gov.
• Report a suspected scam to phishing@irs.gov or file a complaint with the Treasury.

How can I protect myself online going forward?

• The IRS urges taxpayers to be cautious when relying on social media posts.
• Always verify claims with credible sources or consult a qualified tax professional.
• Never click on suspicious links, unknown SMS/text links, or overshare your personal information online.
• Follow Alloy Silverstein’s Tax Fact or Tax Crap video series for actual up-to-date and trending tax tips.

YouTube Series: Tax Fact or Tax Crap

Alloy Silverstein Associate Partner Ren Cicalese III, CPA, MST began an informative video series inspired by this exact topic—misleading tax advice on social media. These quick videos address trending tax “tips,” hacks, and myths and unveil a real answer from a knowledgeable tax professional. View the various videos below and subscribe to Alloy Silverstein’s YouTube Channel to see the latest video as it’s published. Tax Fact or Tax Crap videos are also posted on Alloy Silverstein’s social media accounts.

Topics addressed so far — Are they tax fact or tax crap?

• I’m a full-time student, so I don’t have to pay taxes on my income.
• You can hire your kids to work for you and save on taxes.
• I have a side business, but it doesn’t make a lot of money, so I don’t have to worry about it on my tax return.
• As a sole proprietor, I don’t have to pay Social Security Medicare taxes since I’m not an employee.
• Cryptocurrency does not affect my tax return.
• An tax return extension is also an extension of time you have to pay.
• If you lose money while gambling, you can take that loss on your tax return.
• I’ve put company branding on my vehicle so I can write off the cost of my car.
• I’m in classes to learn about owning a business, the tuition is deductible.
• You can pick any tax filing status that you want when filing your tax return.
• The IRS will call you requesting payment of taxes owed.
• Gifts are not taxable income.
• The IRS doesn’t care about my cryptocurrency holdings.
• You can take a deduction for working from home.
• The IRS has plans to increase income tax return audits.
• You can claim a tax credit for contributions to a retirement plan.
• You can get a tax credit for any foreign taxes paid on your income.
• Your tax filing status doesn’t impact your tax return at all.

The post Beware of Misleading Tax Advice on Social Media appeared first on Alloy Silverstein.

AI-powered phishing attacks

AI can craft messages that look and sound authentic, tricking victims into clicking malicious links or providing personal information.

Deepfake scams

Scammers create realistic videos and audio clips that impersonate real people.

Generate realistic conversations.

Scammers use AI chatbots that can hold realistic conversations with potential victims to trick you into sharing sensitive information or sending money.

You can protect yourself by being skeptical of unexpected messages, verifying identities through a trusted channel and using multi-factor authentication to safeguard your accounts.

The post Scammers Up Their Game With AI appeared first on Alloy Silverstein.

1. The Three Keys to a Great Password

Based on the “Three Keys” tip-series:

• Know the latest security standards.

  • Make your passwords longer.
  • Avoid password hints or reset questions.
  • Don’t repeat the same number or letter.
  • Don’t use common identifiers as a password.

• Don’t use the same password more than once. By using the same password on multiple services, you are potentially giving hackers access to every service where you’re using that password.

• Make use of a password manager. These are programs or apps that will create unique passwords on each of your accounts and store them all for you in a single, secure location, so you’ll never lose them again.

2. Use a Password Manager + Enable MFA

• Enable Two-Factor Authentication (2FA): 80% of data breaches could be prevented with 2FA, which adds a second layer of protection (like a time-sensitive code or biometric scan) beyond just a password.
• Use Authenticator Apps for Extra Security: Free apps like Microsoft Authenticator, Google Authenticator, and Authy provide stronger, more convenient protection than passwords alone—often working without internet access.
• Stay Vigilant with Additional Measures: While 2FA boosts security, consider using tools like YubiKeys or Google Advanced Protection to defend against SIM hijacking and sophisticated cyber threats.

3. Protect Yourself from Online Fraud

Unfortunately, fraudsters are out there. They want your money, your identity, or both, and they’re getting more sophisticated all the time. There’s a wealth of opportunity for swindlers to take advantage of people because so much of what we do is now online. There are ways for you to protect yourself, both by taking action and being aware of what’s going on.

• Never click on unknown links. Take the extra step to a visit a website through its legitimate homepage or call customer service.
• Check your bills. Make sure you check your statements for accuracy every month. Many times, fraudsters start small to see what they can get away with. Catch it early.
• Never share your information via email or on the phone. Trustworthy institutions typically do not ask for your personal information in these ways. If you get a suspicious phone call or email, hang up, and call them directly.

4. Extend Secure Practices to Business & Cloud Use

• Small businesses are prime targets. Many small business owners underestimate their risk, but hackers often find it easier to breach smaller companies due to weaker security measures.

• Employee awareness and system updates are crucial. Human error is a major vulnerability. Establish clear cybersecurity protocols, train your team regularly, and keep your systems and software up to date to protect against emerging threats.

• Protect all sensitive data, not just payment information. Even if you don’t handle credit card data, personal information like passwords or client details is valuable to hackers. Safeguarding all types of sensitive information is essential to maintaining trust and security.

Tips for Everyday Password Security

The digital world is vast and full of opportunity, but it also comes with risks. Whether you’re an individual or a small business owner, cybersecurity is no longer optional. Setting strong, unique passwords, staying informed about current threats, and adopting smart tools like two-factor authentication are simple yet powerful steps to protect your data.

Hackers don’t just target big corporations. Small businesses and individuals are equally at risk, especially if they overlook vulnerabilities. By staying proactive and putting strong cybersecurity practices in place, you can safeguard your personal and professional information and continue to navigate the online world with confidence.

More Resources:

• Three Keys to a Great Password
• 8 Ways to Protect Yourself from Personal Financial Fraud
• Cybersecurity Best Practices for Small and Medium-Sized Businesses
• Cybersecurity Tips for Business Owners
• Stop Scams: Fraud Prevention Starts with Your Employees
• Is Your Business A Tempting Target for Cyber Scams?
• Cybersecurity Tips for the Hybrid Workplace
• 5 Ways to Be Proactive When it Comes to Cybersecurity

The post The Essential Guide to Safeguarding Your Online Passwords appeared first on Alloy Silverstein.

Communication methods

The IRS initiates contact primarily through mail, not email or phone calls. Be cautious of unsolicited communications.

Phone scams

If you receive a call claiming to be from the IRS, do not provide personal information. Instead, note the caller’s details, hang up, and contact the IRS directly.

Email phishing

Avoid opening or responding to unexpected emails purportedly from the IRS. Do not click on links or attachments and report to phishing@irs.gov.

Payment protocols

The IRS will never demand immediate payment or threaten you over the phone. All tax payments should be made directly to the U.S. Treasury or online at IRS.gov.

For more information on tax scams, visit www.irs.gov. 

Related Resources:

• Alloy Silverstein’s Blog Posts on Tax Fraud and Fraud Prevention →
• IRS Issues “Dirty Dozen” Fraud Warnings →
• Avoid IRS Phishing Schemes →
• IRS Identity Theft Season Begins Now →
• Stop Scams: Fraud Prevention Starts with Your Employees →
• Tax Season is Over, But IRS Fraud Scams Are Still Prevalent →
• How to be Smarter than the Fraudsters →

The post Beware: Tax Season is Scam Season appeared first on Alloy Silverstein.

Fraud and Small Businesses

Business owners wear many hats on a daily basis–dealing with issues and tasks in finance, workplace issues, customer service–and also fraud prevention. Cyber threats are aplenty and as new technology gains speed, fraudsters only get more and more creative.

In fact, recent studies showed that 57% of organizations experience phishing attempts on a weekly or daily basis. Safeguard both your business and your employees’ wallets by educating them on the signs and indicators of phishing attempts.

While employees can be victims, they can also be your first line of defense if they are adept at detecting fraudulent communication.

What is phishing?

Phishing is a scam tactic fraudsters use to impersonate a person or business in order to obtain money or sensitive information from an unsuspecting victim.

Scammers use public information sources such as websites, LinkedIn, or online directories to try to be as convincing as possible to the recipient. The messages aren’t always flagged by spam filters, so human error is possible. In addition to posing as a company executive, fraudsters are also impersonating the IRS, USPS, Amazon, QuickBooks invoices, and more.

Why impersonate a business owner or company executive?

Fraudsters are betting that an employee will glance at an email from a higher-up, overlooking the typos in the email address and the body of the message, simply because it’s coming “from” a person of authority.

In this type of scam, the next message will likely involve a request to purchase gift cards and reply to them with the card numbers and even a cell phone number. Don’t fall for it!

Following is a handout you can use to educate your employees on the dangers of phishing emails:
 

Download

Other phishing schemes to watch for

Employees in your finance department are more likely to be targeted. Instead of a scammer posing as the company’s CEO or CFO, they may be on the receiving end of phishing emails pretending to be an employee who needs to change their direct deposit for payroll or a fake vendor demanding an overdue bill payment.

Phishing via text message, or “smishing” is also gaining popularity. As convincing as it may look, never click on a link sent via text or SMS from an unknown number.

Make sure your employees know how to spot a phony invoice request, a bogus shipment tracking link, and a fraudulent request to change a bank routing number.

Scammer Red Flags

1. Urgency

Scammers purposely utilize pressure and authority by posing to be an executive of a company. They typically want their request filled ASAP or EOD, while they have you “hooked.”

2. Suspicious Email Domain

Double check, even triple check, the domain of the email address. Slight variations of an email address are used intentionally. A gmail or other generic email domain can be another warning sign.

3. Tone and Typos

A big tell-tale for fraudsters tends to be spelling errors and poor grammar. Ask yourself, does the body of the message sound like the sender? Are their title and email signature correct?

4. Too Vague

Phishing emails are often short and to the point, lacking context of the request. This can be a red flag, especially when received out of the blue.

5. Gift Cards or Cryptocurrency

Whether pretending to be a CEO, CFO, or even the IRS, scammers’ requests frequently involve purchasing gift cards, bitcoin, or demanding wire transfers.

6. “Off” Feeling

Trust your gut! Weird time of day? Unexpected invoice? Not related to a project you’ve ever worked on before? Don’t ignore your instincts if a message or request feels “off.”

What should you do if you suspect an email scam?

Verify legitimacy

Review for the above red flags. If you have any doubts, independently verify and contact the actual person or source.

Forward to IT

Still unsure? Ask your tech department to check out the message and to block the suspicious sender.

Delete the message

Do not reply or click links. Never send sensitive information such as cell phone or routing numbers.

Always be vigilant

Scam artists continue to get more and more creative… Don’t let your guard down!

Report fraud

If you realize after the fact that you may be a scam victim, come forward to try to remediate the situation, take protective measures, or involve the authorities if needed.

Related Articles

• 3 Precautions to Take Against Phishing Attacks →
• Clues You Are About to Be Scammed →
• 55 Small Business Hit by Phishing Scam — Don’t Be One of Them →
• 3 Types of Internal Theft and How to Protect Your Business →
• Is Your Business A Tempting Target for Cyber Scams? →
• The Family Emergency Wire Money Scam: 4 Ways to Protect Yourself →
• Protect Your Bank Account from Hackers→

The post Stop Scams: Fraud Prevention Starts with Your Employees appeared first on Alloy Silverstein.

Fake online ads and websites.

If it seems too good to be true, it likely is. Before handing over your credit card number, verify the brand, URL, and legitimacy of the item or retailer in question.

Phishing texts/emails disguised as tracking information.

In the age of online shopping, you’re likely receiving many shipping notifications. However, fraudsters are now posing as USPS, FedEx, UPS, and Amazon in an attempt to get access to your personal information. If you believe there is a genuine issue with a real package, contact the business directly and do not click on any suspicious links.

Gift card fraud.

If you are purchasing gift cards for others, make sure the bar code or PIN have not been exposed or compromised. Also, your “boss” will not text or email you out of the blue to urgently buy thousands of dollars of gift cards.

Charity scammers.

While you may have good intentions, fraudsters do not. Make sure your charitable donations are directed to legitimate organizations that you trust.

Shop smart this holiday season by staying informed, verifying sources, and exercising caution in all online transactions.

The post ‘Tis the Season for Holiday Shopping Scams appeared first on Alloy Silverstein.

• Misleading tax information on social media can lure honest taxpayers with bad advice, potentially leading to identity theft and tax problems. Visit our Alloy Silverstein YouTube channel for our “Tax Fact or Crap” series→

• E-mail spearfishing attempts are designed to steal valuable personal information.

• Bogus tax strategies and fraudulent offshore schemes that claim to reduce or avoid taxes altogether.

• Groups masquerading as charitable organizations attract donations from unsuspecting contributors.

• Offer in compromise (OIC) “mills” charge steep fees and aggressively mislead taxpayers into thinking their tax debts can disappear.

Visit https://irs.gov/newsroom/dirty-dozen to view the entire list.

The post IRS Issues “Dirty Dozen” Fraud Warnings appeared first on Alloy Silverstein.

Early tax filing season is the worst time

Your federal tax account at the IRS currently has plenty of money withheld from your paycheck during the course of the year. Until you file your tax return, the IRS is not sure if it needs to pay some of it back to you in the form of a refund.

Thieves know this too, and will try to file a fraudulent tax return before you have time to submit your own. When thieves file early, they can steal some of your withholdings and be long gone by the time you file your own tax return.

What you can do

1. Beat them to the punch. The sooner you file your tax return, the less likely a thief will beat you to your refund.
2. Get an Identity Protection PIN. All taxpayers who can verify their identity can get an Identity Protection PIN (IP PIN) from the IRS. The IP PIN is a six-digit code known only to you and the IRS that helps prevent identity thieves from filing fraudulent tax returns. If you want an IP PIN, visit irs.gov/IPPIN.
3. Check your credit reports. See if there is any suspicious activity on your accounts and on your credit reports.
4. Protect your ID. Be suspicious. Never give out your Social Security Number, do not leave your credit card unattended, never give ID information to someone who calls you, use the password function on your phone, be aware of strange mail, and shred important documents. Your best defense to IRS ID theft is to use best practices to protect your information.

The IRS is becoming better at spotting fakes

If the IRS suspects something is wrong with your filed tax return they will send you a notice. If this happens to you:

• Respond immediately. Get the direct contact information from the IRS website and let them know that you have a possible identity theft problem.
• File an Identity Theft Affidavit (IRS Form 14039). This will record your problem with the IRS and they will take extra steps to ensure your account activity is coming from you and not the ID thief.
• File a police report.
• Contact the credit bureaus.

Having your tax withholding stolen and then needing to unravel this problem within the IRS is a major hassle. Try to stay vigilant and know that there are steps to help protect your tax records. Thankfully, if the IRS pays out a refund to someone stealing your identity, they are on the hook for this loss, not you.

The post IRS Identity Theft Season Begins Now appeared first on Alloy Silverstein.