IRS warns against misleading tax advice from social media

In the United States, amid rising concerns over the integrity of tax claims, the Internal Revenue Service has announced an intensified review process for various tax credits and deductions. This decision comes in the wake of increasing instances of taxpayers following questionable tax advice disseminated through social media platforms, particularly TikTok. Many influencers on these platforms have suggested expansive and often illegitimate methods for inflating tax refunds, including claims related to business vehicle deductions and writing off personal pets as business expenses. Such misinformation has contributed to a significant number of erroneous claims, prompting the IRS to take action. According to their findings, the agency reported that over 700,000 tax returns were under review by the end of 2024, mainly due to potentially ineligible credits being claimed. These reviews not only threaten delays in tax refunds for legitimate taxpayers but also pose the risk of incurring fines for those who submit inaccurate claims. The IRS emphasized the importance of consulting qualified tax professionals instead of relying on social media advice, which often lacks the required understanding of tax laws. The situation has escalated to an alarming degree, and tax professionals have noted a disturbing trend of common misconceptions that lead to costly penalties and delays. The agency's revised approach includes issuing new forms for claiming certain credits and ensuring that taxpayers are aware of the latest scams targeting their returns. As a result, the agency is urging taxpayers to stay informed and to focus on legitimate credits that they may qualify for, and to be wary of misleading advice from non-experts online. In addition to the concerns related to social media advice, the evolving political landscape has also implicated the IRS with new scrutiny from external bodies. Recently, Oregon Senator Ron Wyden expressed concern over access granted by Elon Musk's Department of Government Efficiency to IRS systems, igniting fears regarding the safeguarding of sensitive taxpayer information. The scrutiny of the IRS and its handling of taxpayer data comes at a crucial time as the agency ramps up its reviews and refines its processes to combat fraud and error resulting from manipulated information. The combined pressures of social media misinformation and potential overreach by government officials highlight a volatile environment for both taxpayers and the IRS going into the upcoming tax season.