Tax refund fraud is surging in these states. Here's how to protect yourself before it's too late
Tax refund fraud is surging in these states. Here's how to protect yourself before it's too late
Whether you’re due to receive a tax refund this spring or not, it’s likely that there are scammers out there eager to get hold of your personal information. Each year, fraudsters take advantage of tax season to swipe personal details and, sometimes, even claim your tax return before you get a chance.
With the addition of generative AI tools, which make impersonating tax officials a breeze, these scams have become more efficient—and prevalent—than ever. But that doesn’t mean you can’t outsmart scammers and learn to spot their tactics before they hit your wallet.
Below, PeopleFinders compiled information on where tax fraud is rising the fastest to help you guard against scams and fraud this year and beyond.
What is Tax Refund Fraud?
Tax return fraud, or simply “tax fraud,” can refer to several related scams. The common denominator is the theft of sensitive information, which helps scammers access victims’ financial accounts.
Notable tax fraud schemes include:
- Fraudulently filing a return on behalf of someone else and stealing the resulting refund. This is the scam most commonly associated with the term “tax return fraud.”
- Impersonating an IRS agent through email or phone and demanding immediate payment. Scammers usually follow this demand with threats of liens or levies.
- Phishing emails from individuals pretending to be tax preparers. They often make grandiose promises of huge returns. In the end, they refuse to sign the tax return themselves and leave you holding the bag.
A Quick Note on The Methodology
The rankings below reflect information gathered from the FTC’s 2023 and 2024 Data Books, released through the Consumer Sentinel Network. Information for 2025 has not been released by the federal government in a comprehensive manner that’s similar to this latest Data Book.
10 States Where Tax Return Fraud is Increasing the Fastest
Listed below are the 10 states with the biggest jump in overall fraud reports from 2023 to 2024. State-by-state rankings for tax return fraud were unavailable at the time of publishing.
Each bolded rate reflects the percentage increase in fraud reports per 100,000 residents.
1. Louisiana
- Fraud Increase: 39.8%
The Bayou State, usually known for good times in the Big Easy, has seen some not-so-good times with fraud in recent years. Louisiana ranked No. 9 in fraud reports per 100,000 people in 2024 (1,472), up from No. 17 the year prior.
2. Florida
- Fraud Increase: 38.4%
In 2024, Florida took the nation’s top spot for fraud rates per 100,000 residents at 2,163. The total number of reports came in at 474,314, just shy of California’s 506,727—the country’s highest.
3. Texas
- Fraud Increase: 37.4%
Even with the Lone Star State’s growing population, fraud rates kept climbing in 2024. The state totaled 462,667 total reports that year, up from 327,936 in 2023.
4. New Jersey
- Fraud Increase: 36.3%
New Jersey’s proximity to the financial center of the world lends itself as a hot spot of fraud year in and year out. After ranking No. 12 for fraud rates in 2023, it leaped to No. 8 in 2024.
5. Mississippi
- Fraud Increase: 35.4%
Mississippi’s fraud reports per 100,000 residents (1,221) increased by the fifth-highest rate in 2024.
6. New York
- Fraud Increase: 34.9%
Unsurprisingly, the Empire State wasn’t far behind its neighbor to the east, New Jersey, in fraud increases. New York residents reported 278,662 cases of suspected fraud in 2024, which lagged only California, Florida, and Texas.
7. Georgia
- Fraud Increase: 34.8%
2023’s No. 1 state for fraud fortunately saw its per-capita fraud rate slip to the nation’s second-highest in 2024. Still, the Peach State experienced a nearly 35% increase in fraud reports year to year.
8. Illinois
- Fraud Increase: 33.3%
Illinoisans reported fraud at a notably higher rate in 2024, with 1,469 reports per 100,000 residents. The 2023 rate stands at 1,102.
9. South Carolina
- Fraud Increase: 31.3%
The sixth and final Southeast state on this top 10 list, South Carolina, saw a substantial increase in fraud reports despite having the country’s second-highest population growth rate since 2020 (1.68 percent). Idaho, at 1.89 percent, is growing faster than any other state in the U.S.
10. Maryland
- Fraud Increase: 31.1%
Rounding out this top 10 list is Maryland, which ranked No. 5 in both 2023 and 2024 for fraud reports per 100,000 residents. The state continually ranks among the nation’s wealthiest; in 2023, for instance, only Washington D.C. had a higher median income for one-person households.
5 Tips for Protecting Yourself Against Tax Return Fraud
Living in one of the 10 states previously mentioned may put you at a heightened risk of tax fraud in 2026 and beyond. Even if you live elsewhere, the threat of tax return fraud is never zero. Heeding the following advice will reduce the chances of a scammer accessing your tax documents.
1. Never Give Out Sensitive Information over the Phone or via Email.
If the IRS needs to contact you, it will always send a letter first—usually in the form of a notice. An unexpected phone call or email from someone claiming to represent the IRS is almost certainly a scammer.
Not sure if the person you’re talking to is legitimate? Try running their information through a people finder to find out who’s really on the other end. If the results look suspicious, trust your gut.
2. Be Careful about What You Post Online.
The more you post about your life on social media, the more potential scammers know about you. That doesn’t mean you should delete every one of your accounts, but it’s worth filtering out potentially sensitive information that can be used to answer security questions.
3. File as Soon as You Get Your Tax Documents.
The less time you wait to file your income tax return, the less time scammers have to try to file a fraudulent one on your behalf. Most people discover they have become tax fraud victims by attempting to file their returns and being informed that the IRS already has one on file.
4. Verify the Identity and Credentials of Tax Preparers.
Any legitimate tax preparer has a PTIN, or Preparer Tax Identification Number. That’s not to say that all tax preparers are of the same quality, but you should run—not walk—from an unlicensed one.
Running the preparer’s phone number through a reverse phone lookup tool can help you verify their identity. Another useful tool is the IRS’s Return Preparer Office database, which lets you search by last name and ZIP code.
5. If You Suspect Fraud, Contact the IRS.
The IRS has an interactive fraud reporting page that makes it easy to start a report. Simply select the option on the screen that applies to you, and the website will guide you to the right page. You should also contact your bank and at least one major credit bureau (Experian, Equifax, or TransUnion).
Final Thoughts: Protect Your Money This Tax Season
Despite the countless fraud prevention mechanisms offered to consumers, scammers still find ways to slip through the cracks. Today’s generative AI tools allow scammers and fraudsters to appear incredibly authentic and genuine.
The last thing you want to hear after getting your tax documents to the IRS is to hear that someone has already filed one for you. Knowing how these scammers operate and how to protect your information will go a long way in preserving your long-awaited tax refund.
This story was produced by PeopleFinders and reviewed and distributed by Stacker.
