What is Tax Identity Theft?

Tax identity theft happens when someone gets hold of your personal information, like your Social Security number, and files a tax return in your name to snag your refund. It’s sneaky, it’s frustrating, and it can cause big delays and complications. You might realize something’s wrong when the IRS sends you a notice saying they received multiple returns in your name, or maybe they spot income from a job you never had. Worst of all, it can take months to sort out the mess.

Smart Tips to Prevent Tax Identity Theft

Keep Your Personal Info Safe

Protecting your personal info is crucial. Guard your Social Security number and only share it with trusted sources. Secure important documents at home and shred what you don’t need. Online, use strong, unique passwords for tax accounts and enable two-factor authentication for extra security.

File Early and Stay Ahead

Filing your taxes early isn’t just about getting that refund sooner; it’s also a great way to beat identity thieves to the punch. The earlier you file, the less chance a fraudster has to submit a bogus return under your name. If you can’t file early, keep a close watch on your accounts and stay alert for any suspicious activity.

Watch Out for Phishing Scams

Identity thieves love phishing scams. They send fake emails, texts, or calls pretending to be the IRS or other official sources, asking for personal info or pushing shady links. Remember, the IRS won’t contact you via email, text, or social media about taxes. If you get an unexpected message, it’s probably a scam—don’t click or share your info.

Choose Trusted Tax Prep Services

Whether you’re using tax software or hiring a pro, make sure they’re reputable. Look for credentials like CPA or EA for preparers, and ensure software has good security features like encryption. If it sounds too good to be true, it probably is—especially with your personal info.

Keep Tabs on Your Accounts and Credit

Regularly Check Your Credit Reports

One easy way to stay ahead of tax identity theft is by keeping an eye on your credit reports regularly. You’re entitled to a free credit report every year from the big three credit bureaus: Equifax, Experian, and TransUnion. When you get them, take a close look and check for anything suspicious, like accounts or transactions you don’t recognize. If you notice something that doesn’t seem right, report it right away so you can get it sorted out quickly.

Set Up Identity Theft Alerts

To protect yourself, set up alerts with your bank, credit card, or a monitoring service to spot suspicious activity quickly. You can also get an IP PIN from the IRS—a simple, extra security step to safeguard your tax account from fraud.

Secure Your Devices

Keep an eye on your digital security! Make sure your devices are protected by keeping your antivirus software up-to-date, and regularly update your operating systems and apps to fix any security vulnerabilities. When handling sensitive stuff like your taxes or financial information, stick to a secure network—avoid using public Wi-Fi, as it’s much easier for hackers to get in and see what you’re up to.

What to Do If You’re a Victim of Tax Identity Theft

Act Fast

If you suspect that you’ve fallen victim to tax identity theft, time is of the essence. Start by contacting the IRS immediately. You can call their Identity Theft Hotline at 1-800-908-4490 for guidance on what to do next. They’ll likely ask you to fill out Form 14039, the Identity Theft Affidavit, to officially report the fraudulent activity.

Work Closely with the IRS

Resolving tax identity theft isn’t always a quick fix, but working closely with the IRS can help move things along. Be prepared for some back-and-forth and keep detailed records of all your communications. The IRS might give you a special Taxpayer Identification Number (TIN) or other measures to secure your account while they sort things out. Stay patient—it can take time, but persistence pays off.

Conclusion

Tax identity theft is a hassle, but you can avoid it by securing your personal info, filing taxes early, and staying alert for scams. Prevention is easier than dealing with the aftermath.

Key Takeaway: Tax identity theft is a major hassle that can disrupt your finances and delay your refund. By taking proactive steps like securing your personal information, filing early, and staying alert to scams, you can significantly lower your risk. Always stay informed and vigilant—your identity and your peace of mind are worth it.

FAQs

What should I do if I get a notice from the IRS about a suspicious tax return?

If you get a notification from the IRS about a suspicious tax return filed under your name, don’t wait—reach out to them immediately. Give the IRS Identity Theft Hotline a call at 1-800-908-4490 and follow their instructions. They’ll probably ask you to fill out Form 14039, the Identity Theft Affidavit.

How do I know if an email from the IRS is real?

The IRS won’t email, text, or message you on social media for personal or financial info. If you get one, it’s probably a scam—ignore it and don’t click any links. Report it to phishing@irs.gov.

Can I get a new Social Security number if my identity is stolen?

Usually, the Social Security Administration won’t issue a new number just because of tax identity theft. They generally only issue new numbers if the problem continues and can’t be resolved by other means.

Is there a fee for getting an IP PIN from the IRS?

ope, the IRS actually provides an IP PIN at no cost. It’s a smart way to boost the security of your tax return, making sure that only you can file with your Social Security number.

How can I avoid falling for phishing scams during tax season?

Watch out for phishing scams—don’t trust unexpected messages claiming to be from the IRS. They won’t randomly ask for your personal info. Always verify the source before clicking links or responding.