NY Attorney General Warns of AI-Powered Tax Scams

With the April 15 tax deadline just two weeks away, New York Attorney General Letitia James has issued an urgent consumer alert regarding a surge in sophisticated fraud. As New Yorkers finalize their tax filings, the Office of the Attorney General (OAG) is warning residents to remain vigilant against scammers who are increasingly leveraging artificial intelligence to steal money and sensitive personal information.

The Rise of AI-Powered Tax Fraud

Scammers are utilizing advanced technology to create highly convincing, deceptive content. Attorney General James highlighted several AI-driven tactics, including the creation of lifelike videos featuring celebrities or government officials that promote fake tax incentives or deductions. Additionally, criminals are using AI to generate personalized phishing emails that mimic official tax notices and are employing voice-cloning technology to pose as IRS officials or tax preparers.
These fraudulent calls can appear to originate from legitimate phone numbers and may even reference a victim’s recent credit card transactions to build false credibility. Furthermore, scammers have been found manipulating Google’s AI Overview to display fraudulent phone numbers and links alongside legitimate information. The OAG advises residents to rely exclusively on trusted, official websites rather than AI-generated summaries when seeking tax information.

Recognizing Common Tax Season Scams

Beyond AI-specific threats, the Attorney General identified several traditional fraud schemes that remain prevalent. These include scammers demanding payment for alleged tax debt via gift cards, prepaid credit cards, or cryptocurrency—methods that legitimate government agencies will never use. Other red flags include unsolicited claims that a taxpayer must return a refund due to an IRS error, or the promotion of "free" tax preparation services that ultimately deceive victims into paying hidden fees.
Some predatory tax preparers may also falsely claim they can expedite tax returns for a higher fee or offer loans to pay taxes that carry terms far worse than standard IRS payment plans. Residents are cautioned to be wary of any unsolicited texts, calls, or emails that request personal or financial account information.

Protecting Yourself and Reporting Fraud

To stay safe, the OAG recommends that residents hang up on any suspicious calls and verify the caller’s identity by contacting the agency directly through a trusted, official phone number. Before sharing any information or responding to emails, taxpayers should thoroughly vet the sender. It is also recommended that individuals check the qualifications and history of any tax preparer through the Better Business Bureau and carefully read the fine print of any loan agreements.
If you believe you have been targeted or victimized by a scam, you should report it to the Office of the Attorney General by submitting a complaint online or calling 1 (800) 771-7755. Tax-related scams should also be reported to the U.S. Treasury Inspector General for Tax Administration at 1 (800) 366-4484.