LifeLock Warns AI-Powered Tax Scams Are On The Rise

With tax filing season upon us, AI-powered scams are surging, targeting taxpayers with highly convincing emails, texts and calls, in some cases impersonating IRS agents or employers.

Recent improvements in AI have led to an increase in scams utilizing AI-generated voices, which can convincingly impersonate IRS agents, tax professionals, or other entities and carry on plausible conversations with victims. According to a recent study conducted by LifeLock, the leader in identity theft protection in the U.S. and part of Gen, 56% of individuals have already encountered AI-powered tax scams featuring realistic voices.

“We’re in a new era of tax scams, where AI gives fraudsters an unprecedented advantage,” Ian Bednowitz, General Manager of LifeLock. “The challenge isn’t just that these scams exist — it’s that they’re becoming nearly indistinguishable from legitimate communications. Taxpayers can no longer rely on gut instinct alone to spot a scam. This tax season, the best defense isn’t just caution — it’s education, verification, and the right security tools to stay ahead of these threats.”

In 2024, the IRS Criminal Investigation unit reported $9.1 billion in tax fraud and financial crimes, up from $5.7 billion in 2022. According to LifeLock, 81% of people reported being financially impacted after falling victim to a tax-related scam.

Tax scams seen in past years often involved ghost tax preparation services and fake tax prep websites designed to steal taxpayer data. Now, with the help of AI tools, there is an increase in W-2 phishing scams, disaster relief fund tax scams, and offer in compromise (OIC) scams.

In a W-2 phishing scam, fraudsters target companies’ HR and finance departments with AI-generated emails, voice deepfakes and even chatbot-assisted conversations that convincingly impersonate senior executives. Scammers use company-specific details to trick people into handing over sensitive tax documents like W-2s. Fraudsters can file a tax return using a stolen W-2 and steal the refund, or they can steal sensitive information on the W-2, such as a Social Security Number.

In disaster relief fund tax scams, fraudsters exploit IRS tax extensions for disaster-affected individuals, impersonating officials to steal sensitive data or payments.

The IRS does offer a program called Offer in Compromise to help taxpayers settle their debts, but scammers using AI can deploy robocalls, email campaigns and even deepfake videos of purported “tex professionals” endorsing their debt relief services, but after victims pay high up-front fees, those debt-relief services never materialize.

The experts at LifeLock advise taxpayers to only use reputable tax preparation services, and to verify all communications. The IRS will never use email, text or social media to request personal or financial information, but scammers often do. Taxpayers should also monitor their financial accounts, report suspicious activity, and be cautious with personal data.