Did you know that identity theft ramps up during tax season? Because many of us are graced with a filing extension this year, this is an area where we need to continue to be vigilant. Let’s take a look at what tax-related identity theft is, how to know if you’re a victim and some effective ways for minimizing the risk of your personal information falling into the wrong hands.
What is tax-related identity theft?
Tax-related identity theft occurs when someone files a fraudulent tax return using your stolen private data. This requires access to your name and social security number but can also include stolen bank and financial records.
In 2019, the Federal Trade Commission (FTC) reported 27,450 cases of tax identity theft. This number more than tripled in 2020 to 89,390. This is likely in connection with disbursed federal stimulus payments—something that will be a factor once again this tax season.
How do I know if I’m a victim of tax-related identity theft?
The IRS describes several indicators that a person may be the victim of tax-related identity theft:
- You get a letter from the IRS inquiring about a suspicious tax return that you did not file.
- You can’t e-file your tax return because of a duplicate Social Security number.
- You get a tax transcript in the mail that you did not request.
- You get an IRS notice that an online account has been created in your name.
- You get an IRS notice that your existing online account has been accessed or disabled when you took no action.
- You get an IRS notice that you owe additional tax or refund offset, or that you have had collection actions taken against you for a year you did not file a tax return.
- IRS records indicate you received wages or other income from an employer you didn’t work for.
Tips for helping to prevent tax-related identity theft.
Be wary of people who contact you via email claiming to be the IRS
During tax season, scammers work overtime. Many imitate the IRS and send convincing emails to unsuspecting recipients. If you receive an email claiming to be from the IRS and the sender requests personal or financial information, DON’T OPEN IT. Instead, forward the email to phishing@irs.gov and delete the original. The IRS also has an identity protection page where you can learn the next steps if you inadvertently opened a suspicious email or entered any sensitive information.
File taxes carefully
Depending on how you file, keep these tips in mind:
- If you file in person, only work with a reputable tax preparer.
- If you file online, make sure you update the security on your computer, including firewalls and spyware.
- If you file through the mail, bring your taxes directly to the post office.
Make sure your mailbox is secure
If your mailbox doesn’t lock, mail can be easily stolen. Be mindful of this especially during tax season when criminals are even more vigilant in trying to track down sensitive data. Consider having mail from the IRS sent to a P.O. box to avoid compromising your security.
Shred sensitive information before dumping it into your recycling bin
Once again, leave no stone unturned when it comes to protecting your sensitive information, even at the end of its life. Shred documents containing personal or financial information before you recycle them.
Also, securely lock up copies of your tax documents after your taxes are complete.
Identity theft is a threat to all of us, even more so during tax season. And you can help your customers, employees and members get the protection they deserve and take control of their personal data with identity theft protection plans from Securus Information Solutions. Contact us to discuss your specific needs and learn how we can help!