Greg's Corner

The Fake Tax Form Scam Targeting Homeowners

By Greg Collier

If someone tells you there is a secret federal form that can dramatically reduce your property taxes, freeze your tax bill, or make certain school-related property taxes disappear, you might be tempted to listen.

Especially if you are a homeowner on a fixed income.

That is precisely what scammers appear to be counting on.

Officials in California are warning about online videos, social media posts, and scam calls promoting something called “Form 1098-SR.” The supposed form is being presented as a way for seniors and other homeowners to reduce or freeze their property taxes.

There is just one problem.

According to county officials, there is no such IRS form.

And while this particular warning comes from California, the scam illustrates a much broader problem. Property taxes are complicated, homeowners are constantly looking for ways to reduce their bills, and scammers know that a promise of financial relief can be incredibly powerful.

The Government Form That Doesn’t Exist

The pitch is remarkably simple.

You supposedly qualify for a special federal program that can reduce your property taxes or protect you from increases. All you have to do is file Form 1098-SR.

Videos and social media posts can make the claim sound even more convincing. They may use government-looking terminology, mention seniors or homeowners, and suggest that some little-known federal provision is being kept from the public.

But the supposed federal form is not real.

Property taxes are administered by state and local governments, not through some secret nationwide IRS program that allows seniors to simply freeze their property taxes.

That should be an immediate warning sign.

Unfortunately, the scam does not necessarily stop with a false claim.

The scammers may want your personal information.

What Are They Really After?

A fake tax form is useful to a scammer because it gives them an excuse to ask for information they normally could not obtain.

A homeowner who believes they are applying for tax relief might willingly provide a name, address, Social Security number, property information, financial information, or other identifying details.

The scammer can then use that information for identity theft or other fraud.

There is also another possibility.

The scammer could eventually demand a fee to “process” the application, file the form, or supposedly secure the tax reduction.

That turns a fake government program into a straightforward advance-fee scam.

The victim pays money for a benefit that never existed in the first place.

Why Homeowners Are Vulnerable to This Pitch

Property taxes are confusing enough without someone deliberately making them more complicated.

Rules vary considerably from one state and local jurisdiction to another. There can be exemptions, reassessments, deferrals, credits, and other programs with complicated eligibility requirements.

That creates an ideal environment for scammers.

They do not necessarily have to invent something that sounds completely absurd. They only have to invent something that sounds just plausible enough.

“Form 1098-SR” has the appearance of an official government designation. Someone who does not regularly deal with tax forms might reasonably assume it’s a legitimate program they simply have never heard about.

Scammers thrive in that gap between what people know and what they think they might be missing.

Seniors Are an Obvious Target

The scam is particularly concerning because it appears to target seniors.

For homeowners living on fixed or limited incomes, property taxes can represent a significant expense. A promise that those taxes can be reduced or frozen could sound like an enormous financial relief.

That makes the emotional appeal of the scam just as important as the fake form itself.

The message is essentially, you may be entitled to money-saving benefits that the government hasn’t made obvious to you.

That is a powerful hook.

It also creates urgency if the scammer claims that homeowners must act immediately or risk missing out.

Whenever a supposed government benefit combines a large financial promise with pressure to act quickly, consumers should slow down rather than speed up.

Real Programs Do Exist

There is another reason this type of scam can work so well.

Real property tax assistance programs exist.

For example, California has legitimate programs involving property-tax limits, transfers of assessed values for certain eligible homeowners, tax postponement, and homeowners’ exemptions.

Those real programs have nothing to do with the nonexistent federal “1098-SR” form.

That distinction is important because scammers frequently build fraudulent claims around something that sounds vaguely like a real government benefit.

They take a legitimate concept and attach a fictional program to it.

The same basic technique can be used anywhere in the country.

A scammer can take a real state tax exemption, senior benefit, or property tax relief program and then invent an additional “application,” “registration,” “verification,” or “federal form” that supposedly unlocks the benefit.

The Social Media Scam Machine

This particular scam also demonstrates why social media has become such an effective distribution system for fraud.

A scammer does not have to individually call thousands of homeowners.

One video can potentially reach thousands or millions of people.

Someone sees a video explaining the supposed tax loophole. They share it with friends. Another person posts about it in a neighborhood group. Someone else makes another video repeating the same claims.

Before long, the false information can appear to have widespread credibility simply because people keep seeing it.

That is an important psychological trick.

Repetition is not verification.

A claim does not become legitimate because five different videos repeat it.

Don’t Let a Search Engine Verify the Scam for You

There is another danger with these schemes.

Someone who sees a suspicious claim may search for the supposed form online.

That sounds like a good idea.

Unfortunately, scammers understand that people do this.

Fraudsters can create websites, videos, social media posts, and other content designed to make a fake program appear legitimate in search results.

The safest approach is to start with the government agency itself.

Do not use a phone number, website, or link supplied by the person promoting the supposed tax benefit. Find the official government website independently and look for information about the program there.

If the supposedly revolutionary tax break exists, the government agency responsible for administering property taxes should be able to explain it.

Never Give Your Information to a Stranger Promising Tax Relief

Homeowners should be particularly cautious when someone unexpectedly asks for personal information to process a supposed property-tax benefit.

According to the California officials issuing this warning, legitimate county assessor offices do not request personal identification through unsolicited phone calls, text messages, or emails. Information for legitimate programs is handled through official processes and signed forms.

That does not mean every email or phone call involving property taxes is automatically fraudulent.

It means homeowners should verify who they are dealing with before providing sensitive information.

And that verification should happen independently.

The Bigger Scam to Watch For

The important lesson here is bigger than one nonexistent tax form.

Scammers are constantly looking for financial pressure points.

When grocery prices rise, scams promise coupons and gift cards.

When natural disasters strike, scams solicit donations.

When people are worried about their bank accounts, scammers impersonate fraud departments.

And when homeowners are worried about property taxes, scammers can invent tax-relief programs.

The subject changes.

The formula remains remarkably consistent.

Find something people are worried about. Offer an easy solution. Make the solution sound official. Create urgency. Then collect money or information.

That is why consumers should be skeptical whenever someone claims to have discovered a secret government program that can save them a substantial amount of money.

If It Sounds Like a Tax Loophole That’s Too Good to Be True

Before clicking on a video, filling out a form, or giving someone your personal information, stop.

Check the claim through the appropriate state or local government office. Look for the program on an official government website rather than relying on the website or phone number provided by the person promoting it.

And remember one particularly important rule:

There is no secret federal form that magically makes property taxes disappear.

Property tax relief programs can be complicated, and legitimate programs do exist. But scammers know that complexity can make their lies sound believable.

They are counting on homeowners being too uncertain to question the pitch.

Don’t give them that advantage.

When someone promises to save you thousands of dollars on your property taxes, the best first step may be the simplest one of all: verify before you trust.