Be Smart: Ways to Help Safeguard your Identity during the Tax Season

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The sun is out and clouds are disappearing. We are on the brink of spring in Arizona. Not only does this time of year bring out baseball, flowers, shorts and flip flops (and don’t forget the sunscreen!); but it also brings tax season. Thieves and scam artists thrive on this time of year taking advantage of unsuspecting people by stealing their identities and claiming tax returns for their own.

In an article from Forbes magazine, dated April 22, 2016, the IRS estimated $227 million was claimed in fraudulent refunds coming from 42,148 fraudulent tax returns as of March 5, 2016. For the same time frame, the IRS had prevented issuing fraudulent refunds in the amount of $180 million.   Using identity theft filters, as of February 29, 2016, the IRS found approximately 35,000 fraudulent e-filed tax returns and a little over 700 paper tax returns. For more about these staggering numbers, read Startling Report of IRS Tax Refund Frauds—Including Inside Jobs by Robert Wood at: https://www.forbes.com/sites/robertwood/2016/04/22/startling-report-of-irs-tax-refund-frauds-including-inside-jobs/#1cc809912b6b).

What can you do to try and prevent someone from using your identity for tax fraud? Here are some helpful tips:

    • Be aware
    • File your taxes early
    • Do not carry your social security card. Memorize it.
    • Don’t give out your personal information (unless absolutely necessary)
      • Make sure anyone you do give your personal information to is a reliable source. This includes: name, date of birth, address, social security number etc.
    • Monitor your credit cards and bank statements (make sure all the charges are correct)
    • Don’t use unsecured WIFI/ internet connections to file your taxes
    • Keep updated with the common types of schemes so as to not fall victim
    • Monitor your accounts
    • Review what your tax preparer has prepared
    • Document / keep records
    • Check your credit reports (Transunion.com/ Experian.com/ Equifax.com)
    • Take part in the Maricopa County Sponsored Shred A –Thon
      • These are offered numerous times throughout the year. The next opportunity is our annual Mega Shred-a-Thon scheduled for April 10, 2017. Check the Maricopa County Attorney’s Office website for more information:       http://www.maricopacountyattorney.org/

Has the IRS called you recently telling you that you owe money and you had no prior notice of a pending tax liability? This is a scam.  When the IRS is no longer actively working a case, they will send the account to a collection agency and will send the tax payer a letter stating as such. Once the account is in collection, the IRS will send another letter confirming that the account has gone to collections. Remember, the IRS will not ask for tax payment over the phone and they will not ask for payment on a prepaid debit card. The IRS and/or a debt collection agency will inform the taxpayer of the electronic payment options and all payments by check should be made payable to the U.S. Treasury and sent directly to the IRS and no one else.

If you have any questions or want to confirm a call or contact you have had with someone claiming to be the IRS, you can call the IRS at 1-800-829-1040 or Treasury Inspector General for Tax Administration (TIGTA) 1-800-366-4484. For more: Scam Phone Calls Continue; IRS Identifies Five Easy Ways to Spot Suspicious Calls (March 10, 2017) https://www.irs.gov/uac/newsroom/scam-phone-calls-continue-irs-identifies-five-easy-ways-to-spot-suspicious-calls and New Private Debt Collection Program to Begin Next Spring; IRS to Contract with Four Agencies; Taxpayer Rights Protected (March 10, 2017) https://www.irs.gov/uac/newsroom/new-private-debt-collection-program-to-begin-next-spring-irs-to-contract-with-four-agencies-taxpayer-rights-protected.

What do you do if you suspect that someone has stolen your identity for tax purposes? Contact your local police department and make a report. Go on the IRS website and follow their instructions of how to report suspected tax fraud.

There are different ways that someone can fall victim to tax fraud. Someone could steal your social security number or your tax preparer could steal your tax return. See: How Do You Report Suspected Tax Fraud Activity? (March 10, 2017) https://www.irs.gov/individuals/how-do-you-report-suspected-tax-fraud-activity. The Federal Trade Commission also has a report that you can fill out if you have fallen victim to identity theft. See: Report Identity Theft and Get a Recovery Plan (March 10, 2017) https://www.identitytheft.gov/#what-to-do-right-away.

The Federal Trade Commission has information for people who have fallen victim to identity theft. The first step listed is to file an identity theft report. Read more from Know Your Rights (March 10, 2017) https://www.identitytheft.gov/Know-Your-Rights.

These are but a few helpful hints and things to think about during this tax season. Stay diligent and protect your identity.