Tax season is here, and so are the scammers. The FTC just warned about a massive wave of phone scams using official-sounding fake agency names to trick people into giving up their Social Security numbers — or paying for “tax credits” that don’t exist.
How this scam works
The call comes out of nowhere. The caller claims to be from the Tax Mediation and Resolution Agency or some other official-sounding (but completely fake) government agency. They will tell you that you haven’t paid your taxes and offer to put you in touch with a “tax resolution officer.”
This is what they promise:
- A “red flag check” on your credit
- Help with Applying for an “IRS Liability Reduction Program”
- Settle your tax debt for ‘pennies on the dollar’
None of these programs exist. The IRS does not have a “liability reduction program” that you can apply for over the phone. This is manipulation designed to get you to hand over personal data or pay illegal fees up front. It’s the same playbook used by rogue debt collectors: create urgency, claim authority, and steal your money.
Some scammers leave voicemails saying, “This may be our only attempt to reach you,” creating a false sense of urgency to get you to call back without thinking.
Why these scams are getting worse
According to research from The Kaplan GroupReports of tax fraud increased by 62% in 2025 alone. The monthly average has increased from 87 cases in 2020 to 368 cases in 2025.
$5.7 millionLost early 2025
1 in 4Americans victim
What makes it worse? Artificial intelligence. Scammers are now using AI voice clones to sound exactly like legitimate IRS agents. More than half of Americans (55%) say they have noticed scam attempts becoming more realistic than in previous years. According to the FTC’s latest report, debt fraud calls are now the No. 1 unwanted telemarketing complaint.
Who is most at risk?
While Generation Z adults (18-24) report the most scam attempts, older adults face the greatest financial losses if they fall victim:
- Ages 45-54: 10% lost more than $10,000
- Women 65-74: Half lost between $2,501 and $5,000
- Men 65-74: 40% lost between $751 and $1,000
How to protect yourself
Real IRS Contact
- First contact always by email
- Uses the official IRS.gov website
- This allows you to question amounts
- Never requests immediate payment
- There is never a threat of arrest
Scam signs
- Unexpected phone calls
- There are threats of arrest or deportation
- Requests immediate payment
- Asks for gift cards or bank transfers
- You cannot appeal
If you actually owe back taxes, here’s what you can do:
- Go directly to IRS.gov to check your tax situation
- Only use phone numbers from the official IRS website
- Never give personal information to an unexpected caller
- Report scams to the FTC ReportFraud.ftc.gov
What if you are actually struggling with tax debt?
Here’s the thing: If you legitimately owe money to the IRS, there Are real options. But they don’t come from random phone calls.
The IRS offers legitimate programs such as Offers in Compromise, Installment Agreements, and Currently Not Collectible status. But this requires working directly with the IRS or a qualified tax professional, not a company that cold-called you.
If you’re overwhelmed by debt (tax or otherwise), the first step is to understand all your options. And if you’re expecting a tax refund this year, think carefully about the best way to take advantage of it. Take our Find Your Path quiz to see what might work for your specific situation.
Debt is math wrapped in emotion. Scammers take advantage of emotion; don’t let them.–Steve Rhode
Key Takeaways
- The IRS always contacts you first by mail, never by phone
- There is no “IRS liability reduction program” you can sign up for
- Hang up on any unexpected phone call about back taxes
- The number of reports of tax fraud has increased by 323% since 2020
- Report scams at ReportFraud.ftc.gov
Frequently asked questions
How does the tax authorities actually contact you?
The IRS always sends a letter via US mail as the first contact. They will never call, text, email or reach out via social media to demand payment or ask for personal information.
What should I do if I receive a call from the ‘Tax Mediation and Settlement Office’?
Hang up immediately. This is not a real government agency. Do not provide any personal information, do not call back any number they give you, and report the call to the FTC at ReportFraud.ftc.gov.
Can credit repair companies really settle my tax debt?
Be very careful. Legitimate tax solutions exist, but companies that cold-call you, charge you upfront fees, or promise specific results are likely scams. The IRS maintains a list of authorized private collection agencies and you can always work directly with the IRS on payment plans.
What if I actually owe back taxes?
Contact the IRS directly at IRS.gov or consult a licensed tax professional (CPA, enrolled agent, or tax attorney). The IRS offers legitimate programs such as installment agreements and offers in compromise for people who cannot pay their full tax bill.
How do I report tax fraud?
Report tax fraud to the FTC at ReportFraud.ftc.gov and to the Treasury Inspector General for Tax Administration (TIGTA) at treasury.gov/tigta or by calling 800-366-4484.
(Source: Federal Trade Commission)
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