This scam involves the perpetrator obtaining the name and phone number of delinquent taxpayers. I imagine the list comes pretty simply – by just obtaining tax lien filing information and comparing that data to known phone records. Most of the legwork is probably completed right over the Internet. The scammers then call the target. The idea is to get the target to provide credit card or bank account data over the phone so that one or both of those resources can be cleaned out.
So what are these callers saying that might compel a person to give up his credit card or bank account data over the phone?
In just the past couple of weeks, I’ve had four clients contacted by the scam callers claiming to be the IRS. In all cases, the callers left voice mail messages on phone recorders because the clients didn’t pick up the phone. Two of the clients kept the messages. I had them make a transcript of the calls and send them to me.
The message that was left on Kyle’s phone is as follows:
This message is intended to Kyle ____. Kyle the one second you receive this message I need you or your attorney to return the call. The issue at hand is extremely time sensitive. My name is Michelle Comma calling from the legal department of the Internal Revenue Service and my phone number is 202-809-9356. I’ll repeat it - 202-809-9356. Do not disregard this message and do return the call. Now if you do not return the call and I don’t hear from your attorney either then the only thing I can do is wish you a good luck as the situation unfolds on you.
The second call was to Tracey. Her call went like this:
Good morning, this is Frank Jefferson, and I am calling you from the Internal Revenue Service Tax Audit Department. I have very important information for you, so please listen to me VERY CAREFULLY. We have received a legal petition notice against your name and you SSN regarding a tax form. A lawsuit is going to be filed against you today in federal claim courthouse. So remember to call back 202-568-6936. Now, if you do not respond to this message, we will be forced to issue a non-bailable arrest warrant against you. Thank you and good luck.
The first clue should be this: the IRS will never leave any voice mail with this kind of threat. I’ve seen plenty of IRS abuse and intimidation over the years. But leaving a voice mail such as this is beyond the pale. If the IRS does make a phone call to contact a
taxpayer, the message left is limited to name, title and phone call with a “call me back” encouragement.
Secondly, the syntax is horrible, even by IRS standards. “This message is intended to Kyle.” Really? It’s intended “to” Kyle? I think he meant it’s intended FOR Kyle. Anyway…
Next, both return phone numbers are to the Washington, D.C. area code. No revenue officer in Washington, D.C. is going to make phone calls to Minnesota to collect delinquent taxes. Anytime a revenue officer is assigned to contact a taxpayer directly, that revenue officer will be located in the region where the taxpayer is located. There are at least three revenue officer groups operating out of the Twin Cities area and at least two more in out-state areas. A phone call or visit to a taxpayer in this area will come from a revenue officer in this area and nowhere else.
The person who phoned Kyle said they were from the “legal department” of the IRS. The IRS has no group identified as the
“legal department.” IRS attorneys are known as counsel attorneys and they operate in the IRS’s function known as the Office of Chief Counsel or Division Counsel. If a “counsel attorney” calls someone, the attorney will leave a message that says some thing like, “I’m _____ from IRS counsel’s office. Call me as soon as possible,” and a phone number is provided.
A counsel attorney from Washington would most likely be with the national office. Under no circumstances would a national office attorney by working on an individual collection case. For that matter, no counsel attorney ever works an individual collection
case unless the matter is already in Tax Court, as in a Collection Due Process case. And a taxpayer would certainly know that his case is in Tax Court because the only way a Tax Court case is ever commenced is by the taxpayer—not the IRS—filing the petition to commence the action.
The message left for Tracey is almost comedic but for the fact that it scared her and she wasn’t able to talk with me until the next day. She spent a sleepless night.
For example, the caller said he was from the “tax audit department.” Again, there is no tax audit department. Tax auditors
function within the Examination division of the IRS. An auditor would say, “I’m with Exam” or “the exam function.” Moreover, tax auditors are never tax collectors. Under no circumstances would a tax auditor ever call a taxpayer, no matter how delinquent, and put the squeeze on for collection of any outstanding debt. They may (and do) put the squeeze on to have the client sign audit papers, provide information and accept exam determinations, but they don’t collect money from delinquent taxpayers. Only revenue officers do that.
The caller said in his message that they have “received a legal petition notice” in your name. Never mind the syntax for a moment, the statement itself doesn’t even mean anything. Why would the IRS “receive” a legal petition? And from whom would it come? The
IRS might generate a legal petition, such as by filing a suit to collect delinquent taxes, but in that case, the suit would be served personally on the taxpayer by the U.S. Marshall or indirectly through some other means. The suit would not be announced with a phone call on a message recorder.
Even more bizarre, the caller says that “a lawsuit is going to be filed against you today” if Tracey does not call back. But wait. Didn’t the caller just say they already “received a legal petition notice?” Why file a lawsuit if they already have a legal petition pending? It is clear to me that this caller was simply stringing together as many legal words as he could think of to make the situation sound more ominous.
And speaking of ominous, he threatened to issue a “non-bailable arrest warrant” if Tracey didn’t call back right away. A what? What is a “non-bailable arrest warrant,” and since when does the IRS have the legal authority to issue any kind of arrest warrant, “non-bailable” or otherwise?
I called both the phone numbers provided by the callers. Nobody at Kyle’s phone number answered, though I got busy signals from time to time. When I called Tracey’s phone number, I got some guy who answered the phone by saying “Internal Revenue Service” and he identified himself as “Brian Smith.” He said he was a “senior collections officer.” He said he was in Washington, D.C. I identified myself as Tracey ___ (as Tracey could be man’s name and how would he know) and that I was calling in response to the phone message.
I asked for Frank Jefferson but was told he wasn’t there. I asked “Brian Smith” why the IRS in Washington was calling me in
Minnesota. I was told, “That’s what we do.”
Then “Mr. Smith” asked for the phone number that was associated with the call. I thought that was odd. Since when does
the IRS have its collection records organized by phone number? I always thought they used SSNs to sort their data. But what do I know.
Then I asked what a “non-bailable arrest warrant” was. I was told, “You know, one where you don’t get bail.” I didn’t ask who got to decide whether a person gets bail, a judge or the IRS. But by this time, it was painfully obvious I was not talking to the IRS in
Washington or anywhere else, and I was not likely talking to anybody named “Brian Smith.”
The man I talked with had a bit of an Indian accent (as in a person from India) and clearly did not know anything about IRS
procedure or much of the lingo. For example, I asked how he got the phone number they called and he said it came off the Form W-2F. “What’s that,” I asked. He said, “you know. The tax form.” Oh, the ole W-2F. I didn’t know about that one.
As I continued to press him a bit, he finally just hung up the phone.
I called the number back several days later and again asked for Frank Jefferson, the guy who left the message with Tracey. “Brian Smith” answered the phone again and again asked for the phone number associated with the call. This time I said I was Tracey’s
counsel and asked why they didn’t call me, as my POA is recorded on the CAF system. I asked him if he wanted my CAF number so he could look it up. He responded by saying, “Sorry to bother you.” Then he hung up.
Apart from all the painfully obvious trappings of a scam simply from the comical voice messages, the person I talked with
was clumsy and clearly unaware of anything to do with the IRS—other than the name IRS. But even beyond that, the background noise was plain. I was clearly calling into a phone center. I could here phones ringing in the background and the sound of several voices talking, though I couldn’t make out anything specific.
Most certainly, I was not calling the IRS—whether the legal department, the tax audit department or any other department.
If we would have gotten that far, I’m sure the caller would have asked for credit card information or bank account numbers to pay the “tax” owed right away, “or else.” I would have asked, “or else what,” but didn’t get the chance.
If you or anybody you know gets a call like this, be sure to save the voice mail message (if one is left) and make a transcript of the call. Report it to the Treasury Inspector General for Tax Administration. They investigate scams involving people who attempt
to impersonate IRS employees. You can report such activity at the TIGTA’s web site, which is here:
This article was part of the July 2014 issue of Dan Pilla's monthly electronic newsletter, Pilla Talks Taxes.
LOOKING TO STAY CURRENT ON THE LATEST TAX CHANGES?
Dan Pilla's monthly newsletter, Pilla Talks Taxes, features news stories and developments in federal taxes that effect your pocket book. Each information packed issue shows you how to use little known strategies to cut your taxes, protect yourself from the IRS,
exercise important taxpayers' rights and keeps you up to date on the latest trends in Washington on the important subjects of taxes and your rights. You can't afford to miss a single issue!
An email address is needed to receive this newsletter.
10 issues per year. $99.00 per yr Order Now!