You know that being a consumer in the 21st century puts you at a greater risk of having your identity stolen by hackers. But what you may not know is that you could also have your identity stolen and used against you at tax time. Though the Internal Revenue Service noted in March 2019 that there has been a decline in tax-related identity theft in recent years, it remains among the agency’s Dirty Dozen list of tax scams and more than warrants your caution and awareness.
What is tax-related identity theft?
According to the IRS, tax-related identity theft is what takes place when your Social Security number or Individual Taxpayer Identification Number is stolen for the purposes of filing a fraudulent tax return. In essence, the criminal will file your tax return for you for the purposes of taking your tax refund. This somewhat less common form of identity theft is difficult to track until it’s too late. According to the Federal Trade Commission, you likely won’t know that you’re a victim until you’ve received a letter from the IRS or have your tax return rejected.
What can you do to prevent it?
According to the IRS, there are a few steps that you can take to make sure that you are not a victim of tax-related identity fraud. Because hackers can learn your Social Security number when you e-file your taxes or fill out other sensitive documents online, it’s imperative that you have up-to-date anti-virus software and a functioning firewall on your personal computer and mobile devices. It’s also important that you maintain strong passwords — follow the password phrase methodology while using a mix of lowercase and capital letters, numbers and special characters — and encrypt important documents.
Key to ensuring that your sensitive information is not stolen is the ability to recognize and avoid scams. This, the IRS notes, includes phishing emails with suspicious links and attachments and threatening calls from people claiming to represent financial institutions or government agencies. You should never give out your Social Security information to an unknown party even if they claim to be calling on behalf of the IRS or the bank.
It’s just as important to make sure that you are protecting yourself physically from becoming a victim of tax-related identity theft. This includes not walking around with your Social Security card on a regular basis and making sure that any documents with your Social Security number are either safely stored or properly disposed of.
What to do if you become a victim
If you are the victim of any kind of identity theft, contact our Customer Service Center at (262) 549-8500 immediately to notify us of fraudulent activity so we can take the appropriate precautions with your bank accounts. In addition, the IRS also recommends that you file a complaint with the FTC at https://identitytheft.gov and place a fraud alert on your credit records through one of the three major credit bureaus — Equifax, Experian or TransUnion. You should also contact your financial institution to notify them of fraudulent activity.
If your Social Security number is stolen and you are the victim of tax-related identity theft, contact the IRS as instructed and complete IRS Form 14039, Identity Theft Affidavit. You can also contact the IRS for special assistance at 1-800-908-4490.
Identity theft of any kind is an unfortunate reality for all of us, but being forewarned and forearmed can help make the difference when it comes to effectively responding and recovering if you become a victim. Take care to protect your information and you will minimize your risk of becoming part of a growing statistic.