Even if you guard that critical 9-digit number carefully, you can still have a fraudulent tax return filed using it.
Your first thoughts when you become the victim of a tax identity thief might go along the lines of:
Then the creepy feelings of having been invaded kick in, and you can’t decide what to do first.
Tax identity theft simply means that someone got your Social Security number and filed a fraudulent return with it, claiming a refund. You would probably find out about it when you got a letter from the IRS stating that your Social Security number was used to file more than one return. Or you owe more tax than you thought you did. Or a return came in using your Social Security number, claiming wages from an employer who wasn’t yours.
How did they get your number? Forbes lists 10 ways it can happen. Basically, anyone who works for an employer who has your sensitive personal information of yours can use it or sell it.
The FTC recommends several steps you can take to avoid being a victim of tax identity theft, including:
Online tax identity theft can also be the culprit, so stay as safe as you can there, too. Many websites insist on complex passwords and suggest you change them occasionally. Ideally, you should do this for any site that requires a password, especially anything that contains personal and/or financial information. Keep track on your passwords on paper instead of a computer program that stores them.
When you dispose of desktop hardware and mobile devices, use utility software and/or check your owner’s manual for information on how to delete all information.
Be discriminating about with whom you share information with online – especially your Social Security number. Just as you should never disclose anything sensitive to someone who calls you on the phone, even if they claim to be with a business you patronize, stay mum if someone approaches you online and asks personal questions. Find the number for the business itself and initiate a call if you believe it might be a legitimate request.
Never send your Social Security number, site passwords, account numbers, or similar information to anyone in an email message. Pick up the phone instead. And keep tax identity theft in mind anytime you post something on social media.
If tax identity theft should happen to you, the IRS suggests several steps to take, including:
How long will it take to clear your record? That depends on a number of things. But you can try to minimize the damage by reporting the situation quickly.