IRS Identity Theft Season Begins Now
Be on your guard as the IRS identity theft season starts in late January. Here’s what you need to know.
Each year thieves try to steal billions in Federal Withholdings by stealing your identity. As the IRS focuses more attention on this quickly growing problem, now is the time of year to be extra vigilant.
Early tax filing season is the worst time
Your federal tax account at the IRS has plenty of money in it from all the taxes withheld from your paycheck during the course of the year. Until you file your tax return, the IRS does not know whether you need to pay more in or they need to refund you the excess amounts withheld.
Thieves know this too, and will try to file a fraudulent tax return before you have time to submit your own. By doing this, they can steal some of your withholdings and be long gone by the time you file your own tax return. So what can you do?
- File early. The sooner you file your tax return, the less likely a thief will beat you to your refund.
- Check your credit reports. See if there is any suspicious activity on your accounts and on your credit reports.
- Protect your ID. Be suspicious; never give out your Social Security Number, do not leave your credit card unattended, never give ID information to someone who called you, use the password function on your phone, be aware of strange mail, and shred important documents. Often your best defense to IRS ID theft is to use best practices to protect your information.
The IRS is becoming a better spotter
If the IRS suspects something is wrong with your filed tax return they will send you a notice. If this happens to you:
- Respond Immediately. Get the direct contact information from the IRS web site and let them know that you have a possible identity theft problem.
- File an Identity Theft Affidavit (IRS form 14039). This will record your problem with the IRS and they will take extra steps to ensure your account activity is coming from you and not the ID thief.
- File a police report.
- Contact the credit bureaus.
Having your identity stolen is one thing. Having your tax withholding stolen and then having to unravel this problem within the IRS is a major hassle. Try to stay vigilant and know that there are steps to help protect your tax records. Is there good news in all this? If the IRS pays out a refund to someone stealing your identity, they are on the hook for this loss, not you.