An urgent alert has been issued by the Internal Revenue Services (IRS), state agencies and tax industry to all employers, alerting on the evolving Form W-2 email phishing scheme beyond the corporate world. The phishing scam is spreading contagiously to other sectors including school districts, tribal organizations and nonprofits. Some organizations have been victimized twice from the W-2 scammers due to their coupling efforts to steal employee W-2 information with an older scheme on wire transfers. Please read details from the IRS issued alert below.
How does the scam work?
Various spoofing techniques are being used by the cyber criminals to trick an email to make it appear as if it is from an organization’s executive. Then the email is sent to an employee in the payroll or human resources departments, requesting for W-2 information of all of their employees listed in a list. Please note, this scam is sometimes referred to as a business email compromise or business email spoofing.
The Security Summit partners are urging all employers to be alert and cautious. The W-2 scam, which made its first appearance last year, is still circulating this tax season and to a broader cross-section of organizations including school districts, tribal casinos, chain restaurants, temporary staffing agencies, healthcare and shipping and freight. The businesses that received these related scamming emails last year are continuously being targeted this year. Even though the Security Summit partners warned of this scam’s reappearance last week, there has been an upswing in reports in the recent days.
- Organizations that receive a W-2 scam email should forward it to firstname.lastname@example.org and place “W2 Scam” in the subject line.
- Organizations that received the scams or fell victim to them, should file a complaint with the Internet Crime Complaint Center (operated by the Federal Bureau of Investigation)
- Employees whose Forms W-2 have been stolen, should review the recommended actions by the Federal Trade Commission or the IRS
- Lastly, an employee should file a Form 14039 identity Theft Affidavit, if the employee’s own tax return gets rejected due to a duplicate Social Security Number or if instructed to do so by the IRS.
Please keep in mind, when employers report W-2 thefts immediately to the IRS, then the agency can take steps to help protect employees from tax-related identity theft. The IRS, state tax agencies and the tax industry, are all working together as the Security Summit and have enacted numerous safeguards in 2016 and 2017 to identify fraudulent returns filed through scams like this one. As the Security Summit progresses with their efforts to safeguard information, the cyber criminals are re targeting organizations in need for more data to mimic real tax returns.
Be Safe Online
Taxpayers and tax preparers should be cautious of using search engines to find technical help with taxes or tax software. Selecting the wrong “tech support” link could lead to a loss of data or an infected computer. Also be careful about tech support call scams and keep in mind that tech support will not call users randomly.
The IRS issued a tool for choosing a tax professional look up to help taxpayers search for a paid tax professional for tax help.
Taxpayers in need of free help can access useful information here
Taxpayers in search for tax software can use Free File
More information on this alert can be accessed here
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This information is provided as a courtesy, may change and is not intended as legal or tax guidance. Employers with questions or concerns outside the scope of a payroll service provider are encouraged to seek the advice of a qualified CPA, Tax attorney, or advisor.