Tax season is upon us, and while many of us are eagerly waiting for our tax refunds to hit our bank accounts, others are struggling to get a refund at all. In 2013, the Internal Revenue Service paid $5.8 billion in bogus refunds to identity thieves. According to the General Accountability office, the actual figure is significantly higher because it is challenging to determine how much income tax fraud remains undetected. But the headache doesn’t stop there. Vigilance is key to protecting yourself from tax fraudsters:
- File early in the tax season to get your refund before identity thieves have the chance.
The IRS will never contact you by email, text or social media. If the IRS needs to contact you, they will first do it by mail.
- When filing electronically, use a secure internet connection and avoid public wifi hot spots at places like coffee shops or a hotel lobby. Or, mail your tax return directly from the post office to make it more difficult for thieves to get their hands on your personal information.
- Be wary of IRS imposters, they often come off as very professional and are hard to identify. Scammers posing as the IRS call and say you owe taxes, then threaten to arrest you if you don’t pay right away. They may have some of your personal information like your Social Security Number to try to build credibility with you. The caller ID may even register as the IRS. Hang up and call the IRS directly if you are concerned. Important note: The IRS will only contact you via mail.
- Once tax identity thieves have your Social Security number and personal information, they can use them to commit other forms of identity theft, such as opening new financial accounts in your name. Check your credit report annually to make sure no unsanctioned accounts have been opened at annualcreditreport.com or enroll in proactive identity theft protection.
- If you think your identity has been stolen, call the IRS Identity Theft Protection Specialized Unit at 1-800-908-4490. Report the fraud and ask for IRS ID Theft Affidavit Form 14039. If you are a tax identity theft victim, the IRS may give you a personal PIN number to verify your identity and protect your file going forward.