The Tax-Time Trap: Cybercrime’s Seasonal Spike

Erich Kron, a Security Awareness Advocate at KnowBe4, explains why cybercrime often spikes during tax season. This article originally appeared in Insight Jam, an enterprise IT community that enables human conversation on AI.

Each spring, as Americans gather their financial records and prepare for tax season, cyber-criminals prepare too—but not to file. These scammers gear up for a digital crime spree that preys on urgency, confusion, and trust. Tax season is stressful for many people, making it an open season for scams, and each year brings new twists on old tricks, making it one of the riskiest times of the year for individuals and organizations alike.

Why Tax Season Is Prime Time for Cybercrime

Money is always the motivator, and tax time is when money and sensitive personal data are moving. Between January and April, W-2s, Social Security numbers, financial statements, and other valuable documents get uploaded online and sent around by email. This creates an attractive attack surface that threat actors just cannot resist.

Cyber-criminals do not need to conduct sophisticated attacks to exploit people during tax season. Social engineering tactics like phishing spike during this season, targeting employees with emails that appear to be from the IRS, tax software companies, or even internal HR departments. These emails often contain malicious links or attachments designed to steal logins, install malware, or trick users into fraudulent transactions.

The rapid turnaround and strict deadlines of tax filing contribute to the pressure because the IRS carries so much authority, and dealing with it can be very intimidating for many. In that heightened stress environment, people are more likely to click first and think later. Threat actors are very aware of this and capitalize on this window of vulnerability.

Common Tax Scams to Watch For

W-2 Scams

Attackers will impersonate company executives or someone from HR and request employee W-2 forms. Once acquired, they are sold on the dark web or used to commit tax fraud. These scams often start with a simple spoofed email to HR or payroll teams. The information contained in these forms also makes identity theft trivial for bad actors looking to open fake credit accounts or take out loans in the victim’s name.

IRS Impersonation Scams

Emails or phone calls claiming to be from the IRS threaten legal action or demand immediate payment. The IRS does not initiate contact by email, text, or social media and will only send initial correspondence about issues through postal mail. Knowing that one fact can save victims thousands.

Tax Refund Phishing

Victims are lured into clicking links that promise faster or larger refunds or tax credits. These fake sites often mimic government portals and are used to steal login credentials or install credential-stealing malware.

Malicious Tax Software Lookalikes

Fake versions of popular tax filing software lure users into entering sensitive data, which is then exfiltrated. Many are advertised as free versions of popular paid software; some may even function normally while secretly stealing data in the background.

Businesses Beware: More Than a Personal Problem

Organizations are especially vulnerable this time of year as Finance and HR departments handle a very high volume of sensitive data. A compromised employee account during tax season can trigger BEC attacks, payroll fraud, or ransomware incidents targeting financial systems.

Smaller businesses are particularly at risk. They may lack the budget for advanced threat detection tools and often rely on just-in-time tax filings, leaving little room for error. For them, a single phishing email can result in a devastating loss of data, money, or both.

Even large enterprises are not immune. Attackers often target the supply chain vendors, contractors, and service providers with weaker defenses to leapfrog into larger targets. Tax-related information passing between these parties becomes a valuable target.

Defense-in-Depth: Your Best Strategy

There is no silver bullet in cybersecurity, especially around tax time. Defense-in-depth is key, meaning combining technical controls, employee education, and strong policies:

• Email Filtering and Monitoring: Whenever possible, catch phishing emails before they reach users’ inboxes. Look for flags such as unusual sender addresses, an urgent tone, or unexpected attachments.
• Multi-Factor Authentication (MFA): This step is critical for accounts related to finance and HR platforms, as well as other accounts. Even if credentials are compromised, MFA can often stop unauthorized access. It is not foolproof, but it does help significantly.
• Security Awareness Training: Employees should be taught to identify IRS scams and report suspicious emails, text messages, or phone calls quickly. Teach people to pause and verify before taking any action.
• Data Loss Prevention (DLP): Prevent sensitive tax documents and information from unintentionally leaving the network. Alerts should be configured for large data exports or unauthorized access to sensitive information.
• Incident Response Plan: Be ready to act if something slips through. A fast, coordinated response can minimize damage and preserve evidence.

Final Thoughts

Tax season is stressful enough without the added complication of cybercrime. The stakes are high, and attackers know it, but education, awareness, and preparation are powerful tools. Individuals and organizations alike must treat this time of year with heightened caution.