What to Do if You Experience Tax-Related Identity Theft

As identity thieves become ever more advanced, taxpayers must take extra precautions to protect themselves from identity theft. Not only is the toll a costly financial exercise, the inconvenience, frustration, and emotional toll is one that is difficult to withstand.

Many of us have experienced having a credit or debit card number compromised, but tax-related identity theft occurs with someone uses your stolen Social Security number to file a tax return to claim a fraudulent refund. Over 19 million suspicious returns have been stopped by the IRS between 2011 and October 2014.

Those that have experienced tax-related identity theft usually do not find out about it until they attempt to file a tax return and the e-file is rejected as a duplicate return, or they receive an underpayment or underreporting notice from the IRS because someone has used their Social Security number for employment or other reporting, such as assistance benefits.

What should you do if your Social Security number has been compromised? The IRS recommends the following:

  • File a report with the local police.
  • File a complaint with the Federal Trade Commission at www.identitytheft.gov or the FTC Identity Theft Hotline at 1-877-438-4338 or TTY 1-866-653-4261.
  • Contact one of the three major credit bureaus to place a ‘fraud alert’ on your credit records:
    • Equifax, www.Equifax.com, 1-800-525-6285
    • Experian, www.Experian.com, 1-888-397-3742
    • TransUnion, www.TransUnion.com, 1-800-680-7289
  • Close any accounts opened without your permission or tampered with.

If your SSN is compromised and you know or suspect you are a victim of tax-related identity theft, take these additional steps:

  • Respond immediately to any IRS notice; call the number provided
  • Complete IRS Form 14039, Identity Theft Affidavit. Use a fillable form at IRS.gov, print, then mail or fax according to instructions.
  • Continue to pay your taxes and file your tax return, even if you must do so by paper.

If you previously contacted the IRS and did not have a resolution, contact the Identity Protection Specialized Unit at 1-800-908-4490. They have teams available to assist.  Additionally, the IRS is continuing a pilot program for those that live in Florida, Georgia, or the District of Columbia. Not only have 1.5 million six digit Identity Protection PINs already been issued, those that filed a tax return last year with an address in the areas mentioned above may choose to get an IP PIN. It is important to remember that you currently cannot opt out once you get an IP PIN. You must use an IP PIN to confirm your identity for returns you file from the point you receive the IP PIN and in all future returns. You should receive a new PIN each year, typically in December.

For more information, visit www.irs.gov and search identity theft.


This article was first published on LinkedIn via LinkedIn Pulse on July 29, 2015.

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