Arm Yourself with Information to Stop Tax Identity Theft

Next week (February 3-7, 2020)  is Tax Identity Theft Awareness Week and you need to know that you can fall prey to scammers whether they contact you directly or find some behind-the-scenes way to operate.

A scammer can obtain your Social Security number illegally and file a tax return without your knowledge, The thieves will make off with your tax return and there is a good chance you will only realize what has happened once you file. If a fake return has been filed, the IRS won’t accept yours. You will need to wait for the IRS to complete its investigation and in the meantime, your Social Security number has been compromised and you are vulnerable to other scams.

Other scammers contact possible victims to get them to unknowingly cooperate in the scam. For example, they may call someone pretending to be from the IRS, telling that person money is owed and threaten them in some way unless they send money right away or turn over banking information. 

Education is the best defense. Even if you think you or your loved ones are too smart to be victimized by scammers, the more you know the better. The Federal Trade Commission’s YouTube channel (FTCVideos) offers short, informative videos about possible scams involving tax identity theft. You can also learn more by visiting FTC.gov/Imposters.

Please know that it is IRS practice to contact people by mail first. It is not standard IRS practice to call, text , e-mail, or use social media to initiate contact with someone regarding their taxes.  

FTC.gov offers these tips for preventing tat identity theft:

  • Protect your SSN throughout the year. Don’t give it out unless there’s a good reason and you’re sure who you’re giving it to.
  • File your tax return as early in the tax season as you can.
  • Use a secure internet connection if you file electronically, or mail your tax return directly from the post office.
  • Research a tax preparer thoroughly before you hand over personal information.
  • Check your credit report at least once a year for free at annualcreditreport.com. Make sure no one has opened a new account in your name.
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©Bring Clarity to Your Finances. Arm Yourself with Information to Stop Tax Identity Theft is a post from Bring Clarity to Your Finances

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Claire Emory, MBA, CFA, CFP®

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