2016 year-end tax letter: IRS scam alert

A new scam is being mailed to taxpayers. Unlike most recent scams in which taxpayers receive emails or phone calls that are pretending to be from the IRS, the latest version uses regular mail to deliver phony tax notices.

This scam involves false CP2000 notices that request payment of small amounts so that when the taxpayer reviews the notice or sends a copy to the taxpayer’s accountant, the notice is reviewed and the conclusion made is to “just pay it ... it will cost more to fight it.”

The fake notice looks eerily similar to a real notice sent out by the IRS so caution must now be used to discern its validity. Criteria to watch for includes:

  • The processing center address. Unless you frequently deal with notices and have a memory for the correct Austin Service Center address, you would not know that the “Austin Processing Center” address is bogus.
  • Right-hand corner information. Clear evidence of a bogus notice is found at the upper right of page 1 and the entry “Your Caller ID”: this is NOT the type of information supplied on an IRS notice.
  • Balance due section. An additional error in the bogus notice is the statement “Balance due” as opposed to what a valid CP2000 notice states which is “Proposed amount due.” The real CP2000 notice proposes a tax assessment and is not a bill.
  • Payee information. Another glaring error is “Make your check or money order payable to the ‘IRS.’” Payments are made to the United States Treasury.

When in doubt, ask your tax professional to review any notice before rendering payment.

View more insights in the 2016 year-end tax planning letter >

Download the 2016 year-end tax planning letter >

The information provided here is of a general nature and is not intended to address the specific circumstances of any individual or entity. In specific circumstances, the services of a professional should be sought. Tax information, if any, contained in this communication was not intended or written to be used by any person for the purpose of avoiding penalties, nor should such information be construed as an opinion upon which any person may rely.  The intended recipients of this communication and any attachments are not subject to any limitation on the disclosure of the tax treatment or tax structure of any transaction or matter that is the subject of this communication and any attachments.