The IRS has issued a warning against a new trend on social media encouraging individuals to falsely inflate their withholdings to increase tax refunds.
This "overstated withholding scam" trending on social media involves using tax software to manually fill out a Form W-2 or other tax forms to include false income and withholding information.
The IRS emphasized that such claims could lead to significant financial penalties, with fines reaching $5,000 for each frivolous claim.
"If the IRS cannot verify the wages, income or withholding credits shown on the tax return, the refund will be held pending further review," the agency stated.