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Russian hackers are after your tax return, how not to get hacked

Russian hackers are after your tax return, how not to get hacked
© Roman Romaniuk | Dreamstime.com

Ugh! It's that time of year again. Yep, you guessed it....tax season.

Before you know it, the tax deadline will be here. Although, due to special circumstances, you will have a couple extra days to file this year. Typically what's known as "Tax Day" falls on April 15, this year it will be Tuesday, April 17.

However, due to the massive Equifax data breach that was revealed last year, you probably shouldn't wait until the last minute to file. Why?

Because nearly 150 million Americans had their Social Security number stolen and fraudsters could try and beat you to the punch.

With that whole mess going on, you definitely don't want to have to deal with other security issues. Unfortunately, without taking the proper precautions, you might have to. Hackers are ruthless and have no problem targeting your taxes.

That's why you need to know the safest way to file your taxes so you won't be hacked.

Who's pilfering your tax returns?

Along with tax season comes a frighteningly easy form of identity theft that can cause you a heap of trouble. Thieves with just a little information about you can file a bogus tax return in your name and claim a huge refund.

Your first clue that thieves have stolen your tax refund is when you try to file your tax return and the IRS rejects it because it already has "your" tax return on file. After that, it's a huge hassle to correct the problem, and you could spend months waiting for your refund. If you were counting on that money, then it's a serious financial hardship.

Having your tax refund stolen isn't the only thing to worry about. Hackers are also stealing victims' tax forms and selling them on the Dark Web.

Who's behind this you ask? Well, according to security firm Kroll, nearly two-thirds of all U.S. tax forms found on the Dark Web were posted by bad actors from foreign countries. Mainly Russia and Romania. Of course, it's the pesky Russians again.

Other stolen items that can be found on the Dark Web include credit/debit card numbers, medical records, and W-2 forms. This type of info is sold to fraudsters who use it for identity fraud, which can cause total chaos in your life.  Click here to learn more about the Dark Web.

Much of this stolen information is acquired by scammers through spear phishing emails or scam phone calls. (BonusClick here for in-depth detail of one of these scams.)

Scams like these are so rampant that the FBI is sounding alarm bells, warning both businesses and everyday Americans about them. Here's an image from the FBI breaking down how phishing tax scams work:

Scary stuff isn't it? Now, let's look at one critical thing that you can do to prevent hackers from stealing your identity.

This one thing will help safeguard your identity

The Internal Revenue Service (IRS) is well aware that crooks are trying to steal your identity. It also knows that all a hacker needs to file a fraudulent claim on your account is your name and Social Security number. That's why the IRS has developed an identity protection tool for certain taxpayers.

An Identity Protection PIN is a six-digit number assigned to eligible taxpayers that helps prevent the misuse of your Social Security number on fraudulent federal income tax returns. You have to use the IP PIN on every tax return to prove it's you filing it.

The IRS PIN program is not yet available for every U.S. taxpayer. Getting an Identity Protection PIN starts with figuring out if you're eligible. Read more here to see if you are eligible for this identity protection.

Dealing with the worst case scenario

God forbid you, or anyone you know ever becomes a victim of tax identity theft. If it actually happens, here are some suggestions of what you can do:

Report the crime

File a report with your local police and file a complaint with the Federal Trade Commission at www.identitytheft.gov or by calling the FTC Identity Theft Hotline at 1-877-438-4338.

Request a fraud alert

Contact one of the three major credit reporting agencies (Equifax, Experian, or TransUnion) and ask that a fraud alert be placed on your credit records.

Set up a credit freeze

A credit freeze, also known as a security freeze, allows you to restrict access to your credit reports and scores provided by the three major credit bureaus (Equifax, Experian, TransUnion). Click here to learn how to set it up.

Close fraudulent accounts

Close any credit or financial account that has been tampered with by a thief or opened without your permission.

Contact the IRS

Call the number provided on the IRS notice informing you of the fraud. Complete IRS Form 14039, Identity Theft Affidavit. You can use a form at IRS.gov, print, then mail or fax the form as needed as you clear your tax record.

Pay your taxes

Be sure to continue to pay your taxes and file your tax return on time, even if you must do so by mailing in paper forms.

Stay diligent

If you contacted the IRS about taxpayer ID theft and did not receive a resolution, contact the Identity Protection Specialized Unit at 1-800-908-4490 about your case.

Bonus: Your tax documents hold a gold mine of personal financial information that hackers and identity thieves would love to steal. Be very careful with any extra printed versions of your documents. For extra copies you are not filing under lock and key, be sure to shred them before throwing them out. For safely storing your confidential documents at home, see this fire-resistant locking security box.

If you'd like to learn more about the dark web, listen to my free Komando on Demand podcasts.  There is so much information, we made it a two-part series.

Want more? Subscribe to Kim's Free podcasts from iTunes, Spotify or Google Play and listen to new episodes on your smartphone, laptop or tablet.

Speaking of safeguarding data, here's how to safely delete data forever on your PC or Mac

When you delete a file on your PC, or on a Mac, by sending it to the "Trash," do you think it's gone forever? Think again. Just like a physical trash can, the contents of your PC's Recycle Bin or Mac's Trash Can are still around and can easily end up in the wrong hands.

Click here to learn how to erase your data forever.

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