Internal Revenue Service officials aren't the only ones excited about taxpayer season — ID-theft criminals are, too, because it's one of their most lucrative windows of opportunity each year.
Tax filing season begins soon, and to help you protect yourself and your family, this week's column is focused on guidance and caution in filing taxes, selecting a preparation service and increasing your awareness of IRS-related scams to guard against identity theft.
Since 2008, the IRS has struggled to curb taxpayer identity theft and refund fraud, with more than 1.2 million tax-related identity theft incidents.
A September 2014 General Accounting Office report stated that the IRS paid $5.2 billion in refunds based on
fraudulent tax returns in 2013.
Also in 2013, nearly one-third of all ID-theft complaints pertained to taxes or wages.
Identity-theft criminals steal Social Security numbers and taxpayer-related information to file fraudulent tax returns and to steal refunds. When you, the real taxpayer, files, your refund will not be paid until the IRS resolves your individual case, potentially delaying your refund for up to a year or more.
First, ID-theft criminals know a large number of tax-filing documents from employers, financial institutions, financial-services firms, health-care providers and insurance companies often are sent via the U.S. Post Office and/or e-mail.
Thus identity-theft criminals will try to steal your personal information from the U.S. Post Office, your mailbox or by hacking into your personal and business e-mail accounts. Stay vigilant on how and when you receive your tax documents.
Second, research your tax preparer for any negative past history, as there have been numerous news stories of tax preparers being convicted of stealing tax refunds using stolen identities.
Think about it. We give our tax preparer our most personal information, including our Social Security number and those of our family members. Your preparer knows about your financial assets, your bank-account information, information about your kids and even your marital status – so be vigilant on who you trust to do your taxes.
If you believe you are an ID-theft victim or are at risk of becoming an ID theft victim, you can take the following action:
- Contact the IRS Identity Theft Division at 800-908-4490.
- Complete the IRS Identity Theft Affidavit, Form 14039.
- Report incidents at www.consumer.ftc.gov or at the FTC Identity Theft hotline at 877-438-4338.
- File a report with the local police.
- Contact the fraud departments of the three major credit bureaus.
Mark's most important: Make it harder for ID-theft criminals by filing your returns in a timely manner to help avoid a criminal filing on your behalf. Pay careful attention to and protecting all facets of your 2015 tax filings and make sure you can trust your tax preparation service.
This article was originally published on AZcentral.com and is reposted with the author's permission.