The Internal Revenue Service used National Small Business Week to put self-employed filers on alert about a fast-spreading refund scam, warning in a Tax Tip released May 4, 2026 that promoters are still pushing a bogus “Self-Employment Tax Credit” through social media. The agency named the scheme on its 2026 Dirty Dozen list and said it is closely reviewing claims that arrive under the cover story.
If you file Schedule C or SE, the warning is aimed squarely at you. The IRS framed the scam as one of the highest-risk traps for solopreneurs and gig workers heading into the late-filing season, because the scheme dangles a refund that does not legally exist and lands the filer with the penalty.
What The IRS Tax Tip Actually Says
The agency says scammers are marketing a broad “Self-Employment Tax Credit” online, often through TikTok, YouTube, and paid Facebook ads, and telling viewers they can pull back thousands of dollars in pandemic-era money. The IRS says no such credit exists.
The scheme is loosely based on the Credits for Sick Leave and Family Leave, a much narrower benefit that applied only to certain self-employed people who were unable to work for specific COVID-19-related reasons in 2020 and 2021. The IRS notes that most filers do not qualify and that any inflated claim risks denial, repayment, interest, and penalties.
The Tax Tip also flagged adjacent threats hitting self-employed filers, including phishing emails impersonating clients with “new client” or “document request” subject lines, fake gig-platform tax forms, and ghost preparers who refuse to sign returns. Each of those routes can compromise EFIN credentials or expose Schedule C income data to identity theft.
Why This Matters For Self-Employed Filers
The IRS reviews returns claiming the bogus credit before issuing refunds, and it has begun withholding payments from filers who have already received them. That means an aggressive promoter’s promise can leave a freelancer or microbusiness owner facing months of correspondence and a clawback bill on money already spent.
The risk is heaviest for high-1099 trades like rideshare drivers, delivery couriers, online sellers, and content creators, who are also the audience most often targeted by social media tax content. A single click on a “free filing” link in a paid ad can route private income data to a third-party preparer without any visible warning.
What Self-Employed Filers Should Do Next
Verify any credit you see promoted online against IRS Publication 334 and the official Self-Employed Individuals Tax Center before filing or amending. If a preparer or social media account claims a credit your accountant has never mentioned, treat that as a red flag rather than an opportunity.
Tighten basic security in your filing workflow this week. The IRS recommends multi-factor authentication for email and tax software, keeping anti-malware software up to date, and entering Schedule C income data only on https-protected sites. It also points filers to its Volunteer Income Tax Assistance and Tax Counseling for the Elderly networks for free, vetted help.
What To Watch Next
The IRS will keep rolling out NSBW Tax Tips through May 9, with later installments expected to cover business identity theft and recordkeeping. Expect additional clawback notices to arrive in mailboxes in late summer as the agency processes 2024 and 2025 amended returns that used the bogus credit.
Self-employed filers should also watch for state-level enforcement, as revenue agencies in California, New York, and Massachusetts have begun mirroring federal Dirty Dozen alerts and pursuing related state refund fraud claims independently of the IRS investigation.
Photo by Sasun Bughdaryan: Unsplash
