Tax season is here officially so if you have your W-2, today is the first day the IRS is accepting returns. This year the IRS announced that they have taken new measures to not only protect taxpayers but help victims in the event tax identity theft happens. But before you can protect yourself fully, its best to learn a little bit about tax identity theft and how you can keep yourself protected this tax season.
How tax identity theft works
If a criminal gets a hold of your name and your Social Security or Taxpayer Identification Number (ITIN) you are at risk for tax identity theft. An identity thief will take your name and social security number along with your address and will create a fake ID and Social Security Card. They will then draft up a fake W-2 and claim not only Earned income credit but the First Time Home Buyer Credit which brings in as much as $8,000. Tax identity thieves obtain personal identifying information through data breaches and hacking or stealing sensitive information. Once the fake documents are in place, they will open up a prepaid debit card so the IRS can deposit the money.
Who can be a tax identity thief?
Last year a Florida woman acting as a tax preparer was sentenced to 2 years in prison and 5 years supervised release for not only preparing false claims in order to receive more money but even stole personal information from other people in order to steal their claims. In Alabama, a state employee with access to state databases stole names and social security numbers and conspired with two others who used the information to file false tax returns. Another state employee of the California Department of Public Services stole personal identifying information which was later used to file false returns. In an Oklahoma prison, an inmate serving as a trustee obtained personal information about fellow inmates and from within his cell using a computer was able to file false tax returns.
The above are just a few examples of tax identity theft, but the bottom line is that greed is at the heart of this scheme so even if you think your information is safe, think again. According to the U.S. Department of Justice, criminals can obtain your personal information by stealing your mail, going through your trash or sending fake IRS emails asking for personal information. The IRS urges consumers to secure personal information in their homes, on their computers by changing passwords often and using anti virus/spam software and to never give out personal information over the phone to any person or business asking for it. Remember even if you provide this information to a trusted source, they could get hacked.
If you are a victim of tax identity theft and you live in Santa Ana or elsewhere, contact the IRS Identity Protection Specialized Unit at 1-800-908-4490 extension 214 so they can secure your tax account right away. You should also fill out the IRS Identity Theft Affidavit at http://www.irs.gov/pub/irs-pdf/f14039.pdf
As a resident of Santa Ana or elsewhere you should also report the details of the incident to the Federal Trade Commission at www.consumer.ftc.gov or call the FTC Identity Theft hotline at 877-438-4338. Lastly it is always a good idea to contact Equifax – www.equifax.com, Experian-www.experian.com and TransUnion-www.transunion.com
Still waiting for your tax return?
If you have reported identity theft to the IRS and are still waiting for your tax return, contact the IRS Identity Protection Specialized Unit at 800-908-4490. You can also get additional help if you are having financial hardship due to tax identity theft by contacting the Taxpayer Advocate Service at 877-777-4778. For a more complete list of tips and resources offered by the IRS visit http://www.irs.gov/uac/Newsroom/Tips-for-Taxpayers,-Victims-about-Identity-Theft-and-Tax-Returns-2014
As always thank you for the visit today, it is appreciated. Be sure to forward this article to your friends and family to help raise awareness and hopefully stop tax identity theft before it begins.
IRS (2013). Examples of identity theft schemes -fiscal year 2013 IRS website. Retrieved from http://www.irs.gov/uac/Examples-of-Identity-Theft-Schemes-Fiscal-Year-2013
U.S. Attorneys (2014). U.S. attorneys office warns public to be aware of tax identity theft during tax season United States Department of Justice. Retrieved from http://www.justice.gov/usao/law/news/wdla20140116.html