If you are a victim of identity theft, one area of your life that may be affected is your tax accounts with the Internal Revenue Service. Someone may file a tax return using your social security number. If this occurs, the IRS is likely to reject your legitimate return as they already have one using that social security number. This may also prevent you from filing electronically.
A second situation occurs when you receive a notice from the IRS that you have unreported wage income from an employer you don’t know. It is likely that an undocumented worker has used your social security number to obtain employment and used your social security number.
If you are the victim of tax-related identity theft you should respond immediately to any notice received from the IRS, explaining why you feel you are a victim. If you believe you may be at risk because your personal information has been compromised you should file a police report with local law enforcement. In addition you should phone the IRS Identity Protection Specialized Unit at 800-908-4490. You should also contact your financial institutions. Finally, contact credit bureaus to place a fraud alert on and get copies of your credit reports.
In addition to identity theft, you may also be a victim of online tax related fraud. You should know that the IRS does not initiate taxpayer communications through e-mail nor do they request detailed personal information through e-mail I hate to disappoint you but that e-mail message you got last week stating you have an $853.69 refund with the IRS is a fraud. Avoid opening attachments on any such e-mail messages and forward the message to phishing@irs.gov.
A significant source of internet tax-related fraud originates with e-file phishing sites. These appear to be legitimate online sites for self-preparing and e-filing your tax return. They are often advertised through commercial pay-per-click sites. These returns are usually submitted through valid Electronic Return Originators, so your return does get properly filed. However, before filing your return these sites capture your tax information and reroute your refund to the phisher’s bank account. You don’t know anything is wrong until you don’t receive your refund and check with the IRS only to find out it was sent several weeks ago.
For the latest information on tax related identity theft you can go to www.irs.gov and search on “identity theft.” Taxpayer security has always been a hallmark of the IRS and they are on the forefront of combatting tax related identity theft. But the bottom line is that you need to be proactive about protecting yourself. Don’t give out your personal information indiscriminately and know who you are dealing with – online or face-to-face.