Since 2011, the IRS has been involved with 19 million suspicious tax returns due to identity theft. Fighting identity theft is an ongoing battle as identity thieves continue to create new ways of stealing personal information and using it for their gain. In 2014 and already in 2015 we have heard in the news about massive data breaches at Target and Anthem. Tax-related identity theft occurs when someone uses a stolen Social Security (SSN) number to file a tax return to claim a fraudulent refund. A taxpayer’s SSN can be stolen through a data breach, a computer hack or a lost wallet. Although identity theft affects a small percentage of tax returns, it can have a major impact on victims.
Protecting oneself. Below are some practical steps that you can take to avoid becoming a victim:
- Don’t carry your Social Security card or any documents that include your SSN;
- Don’t give a business your SSN or ITIN just because they ask. Give it only when required;
- Protect your financial information;
- Check your credit report every 12 months;
- Review your Social Security Administration earnings statement annually;
- Secure your personal information in your home;
- Protect your personal computers by using firewalls and anti-spam/virus software, updating security patches and changing passwords for internet accounts; and
- Don’t give personal information over the phone, through the mail or on the internet unless you have initiated the contact or you are sure you know who you are dealing with.
Warning Signs. Please contact us immediately if you receive a notice from the IRS:
- More than one tax return was filed for you;
- You owe additional tax, have a refund offset or have had collection actions taken against you for a year you did not file a tax return;
- IRS records indicate you received more wages than you actually earned; or
- Your state or federal benefits were reduced or cancelled because the agency received information reporting an income change.
Steps to take. Please contact us, and:
- File a report with the local police;
- File a complaint with the Federal Trade Commission (FTC) or the FTC Identity Theft hotline;
- Contact one of the three major credit bureaus to place a “fraud alert” on your account (Equifax, Experian, or Transunion); and
- Close any accounts that have been tampered with or opened fraudulently.
In addition, if your SSN has been compromised and you know or suspect you may be a victim of tax-related identity theft, please contact us immediately. We will help you:
- Respond immediately to any IRS notice and call the number provided;
- Complete IRS Form 14039, Identity Theft Affidavit.
- Continue to pay your taxes and file your tax return, even if you must do so by paper, and
- Contact the Identity Protection Specialized Unit.
Victim case resolution is complex, frequently touching on multiple issues and multiple tax years. A typical case can take 120 days or more to resolve.