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April 15, 2024 |
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AG Nessel Re-Issues Alert to Warn Medium and Small Business Owners That Tax Scams May Target Them
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LANSING – Amid Financial Literacy Month, and on Tax Filing Day, it’s critical that small business owners are vigilant against tax scams by bad actors who are actively targeting entrepreneurs. Michigan Attorney General Dana Nessel is re-issuing her alert, Tax Scams Targeting Small and Midsized Businesses, to underscore the importance of understanding and safeguarding small businesses against financial fraud.
Scammers are stepping up their attempts to deceive businesses through dishonest schemes, putting them in serious financial danger. These scams frequently use threats of legal action, fictitious tax bills, or promises of tax refunds to deceive unsuspecting business owners or their employees.
“Criminals who perpetrate tax scams against small and midsized businesses are not only defrauding hardworking entrepreneurs but also undermining the integrity of our tax system for financial gain,” said Nessel. “My department is committed to protecting all Michigan residents from bad actors. I encourage small business owners to remain vigilant against these fraudulent attempts by understanding the common scams that target their organizations during tax season.”
In her alert, AG Nessel outlines some of the tax-related scams perpetrated against small and midsized businesses.
- Business-Related W-2 Scams – These scams happen when cybercriminals send phony emails or text messages to payroll and HR specialists, enticing them to divulge private tax information to gain access to workers’ W-2 Forms. These tactics put employees and company data at risk. According to the IRS, the communications can read something like this: “I am analyzing some reports and need a copy of your W-2s for last year. Please send ASAP.” Once the cybercriminals obtain the W-2s, they file fictitious tax forms in an attempt to get refunds. Companies should review their policies for sharing employee data and consider a two-person oversight process for approving employee data distribution.
- Employer ID Number Scams – When companies apply for Employer Identification Numbers (EINs), they can be lured to fraudulent websites. EINs are free and can be obtained legitimately through IRS.gov. Any site that does not end with a .gov is not an official government website.
- IRS Imposter Scams – This is the most frequently reported scam, which involves scammers claiming to be from the IRS, who place calls to individuals telling them they or their business owes taxes that must be paid urgently to avoid additional penalties or jail. The IRS will never contact you by text, phone, or email and demand immediate payment and will never ask for payment in the form of gift cards or through money apps.
The AG’s alert recommends businesses create a security protocol and train employees to recognize scams and government imposters.
If you believe your business has been the victim of an IRS scam:
The AG has also launched a Business Identity Theft iniatiaive, and travels the state to provide educational presentations to business groups and chambers to help create awareness about the different forms of identity theft that target small businesses. To inquire about upcoming presentations or to request that this information be delivered to your organization or group, contact the Department.
To file a complaint with the Attorney General, or get additional information, contact:
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