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Identity Theft and Taxes

Published: September 23, 2020

Identity Theft and Taxes

Identity theft is one of the fastest growing crimes in America affecting millions of unsuspecting individuals each year. A dishonest person who has your Social Security number can use it to obtain tax and other financial and personal information about you.

Identity thieves can get your Social Security number by:

  • Stealing wallets, purses, and your mail.
  • Stealing personal information you provide to an unsecured website, from business or personnel records at work, and from your home.
  • Rummaging through your trash, the trash of businesses, and public trash dumps for personal data.
  • Posing by phone or email as someone who legitimately needs information about you, such as employers or landlords.

Tax-related identity theft occurs when a thief uses your Social Security number to file a tax return and claim a fraudulent tax refund. In 2018 alone, there were 649,000 confirmed identity theft tax returns.1 The IRS has become increasingly diligent in its efforts to thwart identity theft with a program of prevention, detection, and victim assistance. The "Taxes. Security. Together." program is aimed at building awareness among taxpayers about the need to protect personal data when conducting business online and in the real world.

Stay Vigilant

By remaining vigilant and following a few commonsense guidelines, you can support the IRS in keeping your personal information safe. Here are a few tips to consider:

  • Protect your information. Keep your Social Security card and any other documents that show your Social Security number in a safe place.
  • DO NOT routinely carry your Social Security card or other documents that display your number.
  • Monitor your email. Be on the lookout for phishing scams, particularly those that appear to come from a trusted source such as a credit card company, bank, retailer, or even the IRS. Many of these emails will direct you to a phony website that will ask you to input sensitive data, such as your account numbers, passwords, and Social Security number.
  • Safeguard your computer. Make sure your computer is equipped with firewalls and up-to-date anti-virus protections. Security software should always be turned on and set to update automatically. Encrypt sensitive files such as tax records you store on your computer. Use strong passwords and change them routinely.
  • Be alert to suspicious phone calls. The IRS will never call you threatening a lawsuit or demanding an immediate payment for past due taxes. The normal mode of communication from the IRS is a letter sent via the U.S. postal service.
  • Be careful when banking or shopping online. Be sure to use websites that protect your financial information with encryption, particularly if you are using a public wireless network via a smartphone. Sites that are encrypted start with "https." The "s" stands for secure.
  • Google yourself. See what information is available about you online. Be sure to check other search engines, such as Yahoo and Bing. This will help you identify potential theft sources and will also help you maintain your reputation.

Fear You Have Been Scammed?

If you feel you are the victim of tax-related identity theft -- e.g., you cannot file your tax return because one was already filed using your Social Security number -- there are several steps you should take.

  • File your taxes the old-fashioned way -- on paper via the U.S. postal service.
  • Print an IRS Form 14039 Identity Theft Affidavit from the IRS website and include it with your tax return.
  • File a consumer complaint with the Federal Trade Commission (FTC).
  • Contact one of the three national credit reporting agencies -- Experian, Transunion, or Equifax and request that a fraud alert be placed on your account.

If you have been confirmed as a tax-related identity theft victim, the IRS may issue you a special PIN that you will use when e-filing your taxes. You will receive a new PIN each year.

 

Through our partnership with Fellows Financial Group all USSFCU members have access to investment management and financial planning services.

If you have questions about your tax-situation contact a Fellows advisor by calling 703.779.9750 EXT. 3 or simply use the button below to schedule a time to discuss.

Schedule an Appointment

For more information on tax-related identity theft visit the IRS website, which has a special section devoted to the topic.

1The Internal Revenue Service, IR-2019-66, April 8, 2019.

Securities offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through Wealthcare Advisory Partners a registered investment advisor. Wealthcare Advisory Partners and Fellows Financial Group, LLC are separate entities from LPL Financial. The LPL Financial Registered Representatives associated with this site may only discuss and/or transact securities business with residents of the following states: CA, CO, DC, GA, FL, HI, IA, MD, MT, NC, OH, PA, VA, TX, WV. Personal and Commercial insurance services are offered through Fellows Insurance Group LLC. Fellows Insurance Group LLC is a separate entity from Fellows Financial Group LLC, LPL Financial and Wealthcare Advisory Partners. 

LPL Financial, Fellows Financial Group LLC, Fellows Insurance Group LLC and Wealthcare Advisory Partners do not offer tax advice. We suggest that you discuss your specific tax issues with a qualified tax advisor. Investments are not NCUA insured. No credit union guarantee. Investments may lose value. Fellows Financial Group LLC, LPL Financial and Wealthcare Advisory Partners are third party partnerships and are not affiliated with United States Senate Federal Credit Union.

Because of the possibility of human or mechanical error by DST Systems, Inc. or its sources, neither DST Systems, Inc. nor its sources guarantees the accuracy, adequacy, completeness or availability of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. In no event shall DST Systems, Inc. be liable for any indirect, special or consequential damages in connection with subscriber's or others' use of the content.

© 2020 DST Systems, Inc. Reproduction in whole or in part prohibited, except by permission. All rights reserved. Not responsible for any errors or omissions.

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