One thing you need to do to protect yourself this tax season

January 14, 2021

By Kim Komando

Every year when tax season rolls around, scammers are on high alert searching for their next victim. But as is often the case, by the time you realize that you have been scammed, it’s too late.

Criminals will use every occasion, national event or celebration to target victims. All scams are terrible, but the worst is when fraudsters steal your identity. It can be challenging to prove to authorities that you have been scammed. Tap or click here for details on the worst identity theft scam you’ve never heard of.

One agency that you don’t want to have identity problems with is the Internal Revenue Service (IRS). Once criminals get hold of your details and start filing tax returns on your behalf, things can get messy. With the tax season fast approaching, we’ll explain a common tax scam and how to prevent it.

How the scam works

Anyone would be confused receiving a notification from the IRS stating that more than one tax return has been filed on their behalf. How is this possible when you only filed once?

In the unfortunate event that you have received such a notification, scammers are already at work. While your Social Security number should always be kept private, fraudsters somehow got their hands on your details, including your SSN, date of birth and address.

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Long before you had time to file your tax return legitimately, the scammers already sent through documents using your personal details. By doing this, the scammers collected your tax refund, and there is often nothing you can do about it.

The Better Business Bureau recently warned Americans that this form of tax theft is rampant. The scammers know that you will only realize that you have been conned when it’s too late.

Avoid being a victim to tax scams

One way to protect from these types of tax scams is to use an Identity Protection PIN issued by the IRS. You may have already been issued one of these numbers last year. You can check with the IRS here.

The BBB has more suggestions to avoid Tax ID theft scams:

• File early. The best way to avoid tax identity theft is to file your taxes as early as possible before a scammer has the chance to use your information.
• Watch out for red flags. If a written notice from the IRS arrives in the mail about a duplicate return, respond immediately. Or, if an IRS notice arrives stating you received wages from somewhere you never worked or receive other notices that don’t actually apply to you, contact the IRS office ASAP. Another big red flag is if you receive a notice that “additional taxes are owed, the refund will be offset or collection actions are being taken against you for a year you did not file a tax return” (IRS). Contact the IRS if you have any suspicions that your identity has been stolen.
• Protect your Social Security number. Don’t give out your SSN unless there’s a good reason, and you’re sure who you’re giving it to.
• Research your tax preparer. Make sure your tax preparer is trustworthy before handing over personal information.
• If you are a victim of ID theft, consider getting an Identity Protection PIN (IP PIN). This is a six-digit number, which, in addition to your Social Security number, confirms your identity. Once you apply, you must provide the IP Pin each year when you file your federal tax returns. Visit IRS.gov for more information.

It’s unfortunate that we have to try to beat the clock when filing taxes, but that’s the world we live in. Thieves are everywhere and will stop at nothing to rip us off. So make sure to follow these safety precautions and protect your finances. It’s always better to be safe than sorry.