Tax identity theft is easier now more than ever with the ability to electronically file tax returns. However, there are steps you can take now to avoid having your identity stolen. Most tax identity thieves will file the fraudulent returns early in the tax year, so you can avoid this by filing your return as early as possible. You can also apply for an Identity Protection PIN from the IRS to reduce the chances of someone else filing your return electronically.
If you file your return with a qualified tax preparation firm, be sure to verify with the preparer than the return was accepted. If you are using an online service, watch for anything unusual and maintain your own records.
Do not confirm personal information in email or over the telephone unless you are in contact with someone you know. Do not provide your bank information to anyone by email and provide it over the phone only to those you are certain you know and trust. Be careful with emails from someone you do not know and beware of phony websites. Protect your computer with firewalls, current and effective anti-virus software and security patches.
You can obtain free copies of your credit report each year from the three credit bureaus: Experian, TransUnion and Equifax. Keep all of your tax records and important documents in a secure location. Do not carry your social security card with you or write it on any checks. Be sure to shred and destroy any financial documents you are disposing of, including receipts, credit applications or bank statements.
Identity Protection PIN
An IP PIN is a six-digit number that prevents someone else from filing a tax return using your social security number or taxpayer identification number. This pin is only known to you and the IRS. Do not share your IP PIN to anyone other than your tax professional while you are submitting your tax return.
Having an IP PIN is not a filing requirement, but it helps the IRS verify your identity when you file your return. New pins are generated each year. The IP PIN being used to file is specific to the current year of filing. So even if you are filing a prior year return, you will use the most current pin received.
The fastest way to get an IP PIN is by using the online Get an IP PIN tool at IRS.gov/getanippin. If you request online, you will need to login each year to retrieve your new pin. You can also submit a paper application either by mail or fax. If you file an application this way, you will be mailed a new IP PIN every year.
Know What the IRS Does (Or Does Not Do)
First contact is always initiated through the US Postal service. The IRS does communicate through social media or text messaging. The IRS will not request sensitive information before the first mailed notice. After the initial mailed notice, an IRS agent may contact by phone, email or in-person visits.
The agents may contact you about money, but payments will only go to the US Treasury. No immediate payment demands are made over the phone or online. If you are contacted by an IRS agent, always request at least two forms of identification.
To confirm if a contact from the IRS is authentic, you can call the IRS toll-free at 1-800-829-1040.
If you receive unsolicited communication from a fraudster, report the call to the Treasury Inspector General for Tax Administration (TIGTA) using their online reporting form, https://www.tigta.gov/ , or over email to phishing@irs.gov
If you have any other questions or concerns about tax identity theft and what you can do to stay safe, reach out to your tax professional.