Tax Season Scams Are Starting Early. Here's the One That Hits Small Businesses First.

February signals the arrival of tax season, a time when accountants get swamped and bookkeepers hunt down paperwork. Everyone's focused on W-2s, 1099s, and looming deadlines.

Yet, an often-overlooked threat lurks at the start of tax season—not a form, but a cunning scam.

This scam often arrives early, targeting small businesses with a convincing, urgent message. It might already be waiting in someone's inbox.

Understanding the W-2 Scam
Here's the scam in action:

An employee responsible for payroll or HR receives an email appearing to come from the CEO, owner, or high-ranking executive.

The message is brief and pressing:

"I need copies of all employee W-2s for an urgent meeting with the accountant. Please send them ASAP—I'm tied up today."

The email feels genuine. The tone fits tax season's hectic pace, and the request doesn't seem unusual.

So, the employee complies and sends the W-2s.

But the email is fake—sent by a cybercriminal spoofing the CEO's address or using a similar domain.

Now, the scammer has access to each employee's:
• Legal name
• Social Security number
• Home address
• Salary details

All the critical information needed for identity theft and fraudulent tax return filing before the employee even files.

Consequences of the Scam
Victims typically discover the fraud when:

Employees attempt to file taxes but receive rejections like: "Return already filed for this Social Security number."

Someone else already claimed their refund.

Employees then face the taxing process of working with the IRS, credit monitoring, identity protection services, and extensive paperwork—all triggered by a single compromised email.

Multiply these risks across your entire payroll, and you face not just security breaches, but serious trust issues, HR chaos, potential lawsuits, and damage to your company's reputation.

Why This Scam is So Effective
This isn't an obvious phishing attempt; it's sophisticated and believable.

It succeeds because:

• Timing is perfect—W-2 requests in February are expected.
• The request is plausible, unlike suspicious wire transfers or gift card demands.
• The urgent tone feels natural during busy tax season.
• The sender's identity looks authentic due to research by the scammer.
• Employees are eager to help their bosses, making quick compliance tempting.

Protecting Your Business from the W-2 Scam
The encouraging news: prevention is possible through strong policies and awareness—not just technology.

Implement a strict rule: never send W-2s via email. No exceptions. Sensitive payroll documents should never leave your office as email attachments. Any email requests for these should be rejected, even if they appear to come from the CEO.

Verify sensitive requests through a secondary channel—call, face-to-face, or chat—not by replying to the email. Use known contact information, not numbers found in the suspicious message. This simple step can save months of trouble.

Schedule a quick, 10-minute meeting now to alert payroll and HR teams about the surge in tax-related scams. Early awareness acts as inexpensive but powerful insurance.

Secure your payroll and HR systems with multi-factor authentication (MFA). If login credentials get stolen, MFA acts as the final barrier against unauthorized access.

Foster a culture where verifying requests is welcomed and rewarded. Employees who double-check suspicious instructions should be praised, not criticized, shutting down scams before they start.

These five rules are simple to adopt and powerful enough to block the first wave of scams.

Looking Beyond: The Spectrum of Tax-Season Threats
The W-2 scam is just the beginning.

Between now and April, expect an onslaught of tax-related cyberattacks, including:

• Phony IRS notices demanding urgent payments
• Phishing campaigns disguised as tax software updates
• Fraudulent emails from "your accountant" containing dangerous links
• Fake invoices made to look like legitimate tax expenses

Tax criminals exploit the distracted and rushed atmosphere during this period.

Businesses that sail through tax season unscathed are not lucky—they're prepared with policies, training, and protective systems that catch suspicious activities before they escalate.

Is Your Business Prepared?
If you already have effective policies and a vigilant team, you're ahead of many small businesses.

If not, it's crucial to act now—before the scam strikes.

If this sounds like your business, take advantage of a free 15-minute Tax Season Security Check.

We'll assess:
• Payroll and HR access controls with MFA
• Procedures for verifying W-2 requests
• Email safeguards to block spoofing
• Critical policy improvements that many businesses overlook

If you're already on top of this, fantastic. But consider forwarding this post to fellow business owners who could be vulnerable—it might save them costly trouble.

Click here or give us a call at 346-477-8630 to schedule your free 15-Minute Discovery Call.

Because tax season is stressful enough without dealing with identity theft.

Schedule A 15-Minute Discovery Call

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