The 2016 tax season is in full swing and with that comes the increased potential for identity theft. Criminals are not just after your credit cards anymore, now they are targeting your tax refund. In January the U.S. Federal Trade Commission (FTC) reported an almost 50% increase in identity theft cases in 2015 with the main complaint being tax refund fraud. Tax fraud occurs when a fraudulent tax return in filed your name using your social security number and personal information. Victims are usually unaware that this has happened until they file and receive a letter from the IRS rejecting their return. Even if you are not required to file taxes or are not due a refund this year you can still be targeting for this scheme.
Here are some tips from the IRS on how to be stay alert and respond to fraudulent activity:
How to reduce your risk
- Always use security software with firewall and anti-virus protections. Create strong passwords.
- Learn to recognize and avoid phishing emails, threatening calls and texts from thieves posing as legitimate organizations such as your bank, credit card companies and even the IRS.
- Do not click on links or download attachments from unknown or suspicious emails.
- Protect your personal data. Do not carry your Social Security card in your wallet, and secure your all tax records.
- Report suspicious online or emailed phishing scams to:firstname.lastname@example.org.
- Report phishing scams by phone, fax or mail, call 1-800-366-4484.
- The IRS does not initiate contact with taxpayers by email to request personal or financial information. This includes any type of electronic communication, such as text messages and social media channels.
Steps to take if you become a victim
If you are a victim of identity theft, the Federal Trade Commission recommends these steps:
- File a complaint with the FTC at apps.irs.gov
- Contact one of the three major credit bureaus to place a ‘fraud alert’ on your credit records:
- Equifax, www.Equifax.com, 1-800-766-0008
- Experian, www.Experian.com, 1-888-397-3742
- TransUnion, www.TransUnion.com, 1-800-680-7289
- Contact your financial institutions, and close any financial or credit accounts opened without your permission or tampered with by identity thieves.
- If your SSN is compromised and you know or suspect you are a victim of tax-related identity theft, the IRS recommends these additional steps:
- Respond immediately to any IRS notice; call the number provided or, if instructed, go to IDVerify.irs.gov.
- Complete IRS Form 14039, Identity Theft Affidavit, if your e-filed return rejects because of a duplicate filing under your SSN or you are instructed to do so. Use a fillable form at IRS.gov, print, then attach the form to your return and mail according to instructions.
- Continue to pay your taxes and file your tax return, even if you must do so by paper.
Source: irs.gov, identitytheft.gov