In this article we’re focusing on another top tax scam on the IRS’s 2025 Dirty Dozen: the so-called Self Employment Tax Credit, which is a fictional refund promised by social media promoters and slick ads. Spoiler: it’s more mirage than money.
What Is This “Credit,” Really?
There is no general self employment tax credit. What scammers actually refer to are the very limited Credits for Sick & Family Leave under Form 7202 for self-employed folks. That’s it. Nothing more.
How the Scam Plays Out
- Ads on TikTok or Instagram promise refunds up to $32,000 for “gig workers” or freelancers.
- Attackers urge people to file bogus Form 7202 claims, even for 2023 or 2024.
- Vague rules, no proof required, yet they tout “secret loophole.”
- Taxpayers file, get IRS notices, frozen refunds, fines, or worse.
IRS Warning Loud & Clear
The IRS has issued alerts to “trusted tax professionals” and consumers, calling this a non-existent credit and urging filers to avoid social media hype.
What You Should Do
- Ignore promises of a “Self Employment Tax Credit.”
- Only use Form 7202 if you were self-employed and actually took COVID-related leave in 2020 or 2021.
- Ignore claims that you’re eligible today or for past years.
- Respond to IRS notices promptly. Don’t ignore them.
- Amend your return to remove any falsified claims.
Trust Smith Patrick CPAs to Separate Fact from Fiction
If you’ve fallen for this scam, or just want a trusted accountant on to help with your self-employment filings, Smith Patrick CPAs is here to help. We’ll sift through the noise, apply the rules where they actually apply, and keep you in the IRS’s good graces. No tricks, just facts.
More Information
If you have questions, contact us to discuss your situation.
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Reneé Spillers
Reneé Spillers is a Staff Accountant at Smith Patrick CPAs, specializing in monthly accounting and tax services. She holds a Bachelor’s degree in Accounting from Illinois Wesleyan University and is committed to building strong client relationships while delivering reliable financial services.
About Smith Patrick CPAs
Smith Patrick CPAs is a boutique, St. Louis-based, CPA firm dedicated to providing personal guidance on taxes, investment advice and financial service to forward-thinking businesses and financially active individuals. For over 30 years, our firm has focused on providing excellent service to business owners and high-net worth families across the country. Investment Advisory Services are offered through Wealth Management, LLC, a Registered Investment Advisor.
