Tax season brings tax scams like night follows day. And with all the advice circulating on the internet, it can be hard to separate the good from the bad. The IRS has recently flagged a particularly pernicious W-2 "tax hack" which encourages people to claim unearned credits and bigger tax refunds by lying about their income. Here's the breakdown of this bad idea and the legal consequences for any taxpayer unwise enough to try it.
The IRS is warning taxpayers (opens in new tab) about a scheme flying around on social media that advises manually altering your W-2 form to add false wage data. Scammers are advising people to invent larger-than-life withholding figures, as well as fake employers, before electronically filing the false return to obtain a giant refund. The standard deduction just isn't enough for some people, apparently.
The IRS, state tax authorities, and tax industry firms are monitoring a variety of tax schemes as Tax Day approaches. The IRS coordinates the Social Security Administration, major employers and payroll companies like ADP to review W-2 information. So if you think you can slip fake job information through the net, think again.
Tax authorities are tracking two variants of the W-2 scheme that misuse wage info to generate a big, unearned refund.
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