With tax season here, the Internal Revenue Service is warning consumers to be aware of scams that could target your money or identity. Though tax scams are a problem all year, consumers can be especially vulnerable as they complete their paperwork to submit their taxes by April 18. 

According to an IRS alert, thousands of people have lost millions of dollars and their personal information to tax scams and fake IRS communication in recent years.

Last year, IRS scams were the No. 1 complaint made through the Better Business Bureau's Scam Tracker tool, accounting for as much 30 percent of all fraud reports, says Emma Fletcher, who runs the Scam Tracker program.

This IRS' alert comes despite a crackdown last October on an alleged fraud ring operating in the U.S. and India, where scammers posing as IRS agents made thousands of threatening calls to Americans each day. 

"The India development resulted in a significant drop in tax scams, but we're still seeing a lot of activity," says Terry Lemons, an IRS senior spokesman.

Here's how you can you protect yourself from some known scams:

You're Under Arrest

You get a phone call from someone posing as an official from the IRS or a local law enforcement agency. The person tells you that you have an unpaid tax bill and threatens you with arrest, deportation, and suspension of your driver's license or business license, or some other penalty unless you pay your bill immediately. He also tells you to pay by debit card (so the money is immediately withdrawn from your bank account), gift card, or wire transfer. The caller may even "spoof" the caller-ID information that appears on your phone so that it appears that the call is coming from a government agency.

In another phone-related scam, a fake IRS official calls students and tells them that they owe a “federal student tax”—a tax that doesn’t even exist. The caller threatens the student with arrest unless he immediately wires his payment.

What you should do.
You should hang up, says the IRS' Lemons. He says the IRS will never call you to demand immediate payment, and it will never threaten to arrest you for unpaid taxes. 

Also, don’t accept specific payment instructions, he says. The IRS offers many payment methods, and you can choose the one you want.

We Need Your Social Security Number

You receive an email that looks like a bill for unpaid taxes in connection with the Affordable Care Act. Or you may get an email that appears to come from the IRS Taxpayer Advocacy Panel telling you that it is sending you a refund. In both cases, the email asks for your Social Security and bank account numbers to confirm your identity.

What you should do. The IRS advises that you ignore messages that come by email, text, or social media because it does not use these forms of electronic communication to contact taxpayers. If you receive a message but you aren’t sure whether it’s legitimate, don't respond or click on any links. Instead, contact the IRS at 800-829-1040.

You Need to Download Software

You receive an email that appears to come from a software company. It instructs you to download tax software updates from a website. The downloads turn out to be malware that can steal sensitive information stored on your computer.

Similarly, you could get a phone call, email, or text from a bogus IRS official who instructs you to enter personal information about yourself into a phished IRS website. Once you log on to that site, it may also download malware that records the passwords stored on your computer.

What you should do.  Never click on links in an email suggesting that you update your tax software, Lemons says. Verify the update with a legitimate software company or an IT professional first.

Also, look for signs that a site is not authentic, such as misspelled words and website addresses that don’t match the site’s name. 

You can also take these steps:

  • Report the scam to the Treasury Inspector General for Tax Administration. The phone number is 800-366-4484.
  • Forward emails you think come from scammers to phishing@irs.gov.
  • Contact the IRS Identity Protection Specialized Unit if you believe someone has used your personal information to file a tax return or steal your identity. The phone number is 800-908-4490.