Watch out for the latest W-2 Tax Scam. This Form W-2 phishing scam made victims of hundreds of organizations and thousands of employees last year.
The IRS says the Form W-2 scam has emerged as one of the most dangerous phishing emails in the tax community. During the last two tax seasons, cybercriminals tricked payroll personnel or people with access to payroll information into disclosing sensitive information for entire workforces. The scam affected all types of employers, from small and large businesses to public schools and universities, hospitals, tribal governments and charities.
Here’s how the scam works: Cybercriminals do their homework, identifying chief operating officers, school executives or others in positions of authority. Fraudsters posing as executives send emails to payroll personnel requesting copies of Forms W-2 for all employees. Criminals use that information to file fraudulent tax returns, or they post it for sale on the Dark Net.
The initial email may be a friendly, “hi, are you working today” exchange before the fraudster asks for all Form W-2 information. In several reported cases, after the fraudsters acquired the workforce information, they immediately followed that up with a request for a wire transfer.
Employers should be aware that cybercriminals’ scams constantly evolve. Finance and payroll personnel should be alert to any unusual requests for employee data and verify the request is valid.
The IRS established a special email notification address specifically for employers to report Form W-2 data thefts. Here’s how Form W-2 scam victims can notify the IRS:
Email email@example.com to notify the IRS of a Form W-2 data loss and provide contact information, as listed below.
In the subject line, type “W2 Data Loss” so that the email can be routed properly. Do not attach any employee personally identifiable information data.
- Include the following:
- Business name
- Business employer identification number (EIN) associated with the data loss
- Contact name
- Contact phone number
- Summary of how the data loss occurred
- Volume of employees impacted
Businesses and organizations that fall victim to the scam and/or organizations that only receive a suspect email but do not fall victim to the scam should send the full email headers to firstname.lastname@example.org use “W2 Scam” in the subject line. Contact our office for further information!