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Tax-related identity theft has surged by 45% since the pandemic, with over 1 million returns flagged for potential identity theft by May 2023. But by taking advance precautions, you can help reduce theft risks and possible headaches.
What is tax identity theft, and how does it occur?
It happens when a scammer uses your personal information, like your Social Security number (SSN), to pretend to be you as they file a fake tax return. This way, they can receive your tax refund instead of you. You may also be scammed out of your money if the thief pretends to be the IRS and calls you on the phone, threatening you with arrest or some other serious consequence if you don’t pay what you owe.
Tax identity theft can happen through various means, including opportunistic theft of sensitive mail containing your SSN or hacking into your online accounts. Scammers may exploit late tax filings, posing as you to file false returns or hack into your accounts when filing over unprotected Wi-Fi networks.
Additionally, improper disposal of sensitive documents can expose your personal information to identity thieves. The U.S. Department of Justice warns that anyone with a SSN is vulnerable.
How do you protect yourself from tax identity theft?
Though there is no surefire way to prevent identity theft, taking a few proactive steps helps keep less motivated ID thieves at bay.
1. When filing online, use a secure Wi-Fi network. You could also use a Virtual Private Network (VPN) to be even safer.
2. File as soon as possible to avoid giving thieves time to mishandle your personal information.
3. Filing by mail? Instead of leaving your tax return in your home mailbox, drop it off at the local post office or in an official mailbox.
4. Were you expecting your tax return documents but have not found them? That could be a sign that a thief swiped them from your mailbox.
5. Immediately shred or burn sensitive documents you no longer need instead of throwing them into your trash intact.
6. Don’t trust emails, texts, or phone calls that claim to be from the Internal Revenue Service. The IRS will always contact you by official letter first.
What do you do if you are a victim of tax identity theft?
If you can’t find your tax return, receive an IRS alert that your taxes have been already filed, or think you fell victim to a scam message, don’t panic. Here are ways to fix this problem.
• Did the IRS officially contact you? Respond as soon as possible using the number they provide for you in their letter.
• Did your SSN already get fraudulently used to file taxes? You can complete Form 14039, Identity Theft Affidavit, which allows you to submit details of your tax identity theft to the IRS. You can either submit it online or physically mail it once completed.
• IdentityTheft.gov is a helpful resource that offers steps to take if you believe you have fallen victim to tax identity theft.
Here’s how IDShield can help.
Discovering that your identity has been stolen can be a frightening experience. But IDShield is here to assist! We take your identity seriously and provide essential identity monitoring and restoration services. This benefit gives you:
• Access to credit monitoring, cybersecurity, device protection, instant alerts and more to give you peace of mind.
• If your identity is stolen, a dedicated Licensed Private Investigator will do whatever it takes for as long as it takes to restore your identity to its pre-theft status.
• A Fraud Protection Plan reimburses members for certain identity fraud expenses and legal costs due to covered fraud events.