IRS alerts taxpayers to risky refund claims spreading online

The Internal Revenue Service is warning taxpayers about phony tips, tax credits and other viral advice that will trigger trouble with your return.

Sure, not many people would say no to a shot at a bigger tax refund. But the Internal Revenue Service is warning about phony tax tips, oddball tax credits and other scams that will trigger trouble with your taxes.

Instead of a quick rush of more refund cash, you'll likely wait much longer than you'd expect for any legitimate tax refund that you're likely owed.

What's new this year: The IRS is seeing an uptick in overstated or fabricated claims tied to undistributed long-term capital gains claims via Form 2439, Notice to Shareholder of Undistributed Long-Term Capital Gains.

This form, which looks vaguely like other documents that report income, gives shareholders of certain investment funds or real estate trusts a way to claim a refundable credit for taxes paid on undistributed capital gains.

This year, the IRS reported that it has identified schemes where claims regarding undistributed long-term gains are overstated or totally fabricated. Sometimes the undistributed capital gains claims are connected to organizations that are not even legitimate investment funds or real estate trusts.