According to the IRS, “Tax-related identity theft occurs when someone uses your stolen Social Security number (SSN) to file a tax return claiming a fraudulent refund.” Identity theft is a serious problem because the thief can access financial accounts and claim illegal refunds, and it’s difficult to detect immediately. In some cases, months go by before a victim becomes aware that they have been subjected to tax fraud.
The Department of Homeland Security provides the following tips for avoiding being a victim of tax fraud:
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Do business with reputable companies
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Take advantage of security features
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Be careful what information you publicize
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Use and maintain anti-virus software and a firewall
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Be aware of your account activity
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Check privacy policies
Phishing emails are especially common during tax season; they are scam emails crafted by hackers in an attempt to trick you into clicking a link that will allow them to access your private information in a variety of ways. Read this article for information about how to recognize and prevent becoming a phishing victim.
Homeland Security also provides the following indicators for signs that your identity has been stolen:
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unusual or unexplainable charges on your bills
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phone calls or bills for accounts, products, or services that you do not have
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failure to receive regular bills or mail
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new, strange accounts appearing on your credit report
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unexpected denial of your credit card
The IRS identifies further indicators for theft:
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More than one tax return was filed for you
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You owe additional tax, have a refund offset or have had collection actions taken against you for a year you did not file a tax return
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IRS records indicate you received wages or other income from an employer for whom you did not work.
If you believe your identity has been stolen, visit this link and this link to find out the appropriate next steps to recover your identity and prevent financial losses or other inconveniences.