IRS Warns on 'Student Tax Scam'

In IR-2016-81 the IRS warned students not to fall for a new scam. Phone scammers call a student and claim to be from the IRS. The scammer will notify the potential victim that he or she has not paid the "student tax."

Scammers often demand immediate payment of taxes. The scammer may threaten a student with arrest, deportation or revocation of a driver's license.

IRS Commissioner John Koskinen stated, "These scams and schemes continue to evolve nationwide, and now they are trying to trick students. Taxpayers should remain vigilant and not fall prey to these aggressive calls demanding immediate payment of a tax supposedly owed."

In response to media pressure, the IRS also made public a May 20 memo by IRS Deputy Commissioner for Services and Enforcement John Dalrymple. He indicated that all future audits will be initiated with a letter. Dalrymple stated, "Although we recognize making initial contact by telephone to schedule an appointment in some of our examination operations has been a long-standing policy, the IRS is changing its practice in response to the threat of phone scams."

Dalrymple emphasized that audits in the future will be initiated with a letter. The IRS memo states, "All initial contacts with taxpayers to commence an examination must be made by mail, instead of the telephone, using the appropriate initial contact letters."

Commissioner Koskinen has repeatedly pledged that there will be no IRS phone calls prior to a letter. The IRS was not following this practice in Iowa. In a May 5 taxpayer forum in Iowa, several taxpayers reported the IRS had called them to initiate an audit.

The new policy should eliminate this practice. Under the new policy, following the mailing of letter the IRS is permitted to make a phone call after 14 days.