Tax Day was yesterday, so I hope you got your tax return filed, or at least filed for an an extension. If you happen to end up with a refund, now you just have to sit back and wait for your check, direct deposit or debit card to arrive.
However, that wait might be a lot longer than you might expect if hackers have their way. When a hacker files a fake tax return in your name, it can take 120 days to several years to clear up the mess to finally get the refund money that the IRS owes you.
That happened this year to newlywed teachers Eric and Lauren Oxford, who were counting on their $3,500 refund. When it came time to file, however, someone had already claimed a refund using Eric's name and Social Security number. He thinks hackers got the SSN in the Anthem Insurance breach earlier in the year. Now the IRS is holding their entire refund until the mess is straightened out. Unfortunately that could take months or even years.
This situation hits the Oxfords particularly hard. They had been scrimping and saving for a home down payment and were counting on the $3,500 refund to finally reach their goal. But now when their rental lease is up, instead of moving into their first house, they will be moving in with Eric's mom.
And that's just a fraction of the billions of dollars the IRS will be paying out in fraudulent returns this year. In 2011, for example, the IRS paid out $5.2 billion to thieves. Some of the people affected back then just got their refunds this year.
There are several steps you can take to stop this from happening to you. Filing as early as possible is a good one, but not everyone can manage it.
You'll want to create an IRS.gov account, even if you aren't planning to e-file through the site. This keeps hackers from creating an account in your name. Click here to create an IRS.gov account now.
Then you'll need to take steps to secure your SSN, know what to do if you think a scam is taking place and avoid tax-related scams, like this email I got in my inbox just days ago. Click here for full details on what you need to do to protect your tax return.