Don’t Be A Victim: Tips to Avoid Tax-Return Identity Theft

March 10, 2019

Any bookkeeping, business or tax article contained in this communication, including attachments and enclosures, is not intended as a thorough, in-depth analysis of specific issues, nor a substitute for a formal opinion, nor can it be used to avoid tax-related penalties. If desired, we would be pleased to perform the requisite research and provide you with a detailed written analysis. Such an engagement may be the subject of a separate engagement letter that would define the scope and limits of the desired consultation services.

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Some people did not receive their tax refund not because they are not entitled but because identity thieves have already filed a tax return claiming a fraudulent refund. Identity theft is an exasperating process for both the IRS and victims. In fact, the IRS received around 242,000 identity theft reports in 2017. Despite the number being significantly lower than the 677,000 reports in 2015, this brings a new issue as scammers try to up their game to continuously steal from taxpayers.

As a taxpayer, there is no absolute assurance that you are protected from tax identity fraud. However, you can have a preventive measure to reduce the risk:

 

  1. Keep Your Social Security Number Private and Safe

Avoid Identity Theft

Identity theft fraud can happen once the SSN is known to others. It is important that you keep it as private as possible and you should not carry your Social Security cards around unless you need it.

 

  1. Keep Your Financial Information Private

Avoid Identity Theft

There are several ways identity thieves can access your financial information aside from hacking your computer. They could look at the hard copies of the financial documents hence make sure that these are kept in a locked cabinet or kept in a secured location. Additionally, don’t give financial information to someone especially not over the phone or through email unless you know the person and it’s absolutely necessary.

 

  1. Shred Documents That Contain Your Personal Identification

Avoid Identity Theft

The tax documents, bank, and credit card statements, and receipts are usually kept for a period of time but once these documents are no longer needed these should all go to a shredder. Documents that contain your name, address, contact information, and SSN should be properly disposed of.

 

  1. Create Strong and Unique Passwords

Avoid Identity Theft

Encrypt important files such as tax-related documents. Use strong and unique passwords for your computer and financial sites that you use. Change it frequently and make it private.

 

  1. Use Security Software to Avoid Computer Viruses

Avoid Identity Theft

Always turn on your security and anti-virus software and make sure that it’s always updated. There are many options that you can choose from, do a research on what is the best security software that could fit your needs.

 

  1. Beware of Phishing

Avoid Identity Theft

Identity thieves use a lot of tricks to deceive their victims. The phishing emails might look legitimate coming from your bank, credit card or even IRS asking for your personal information. Remember legitimate institutions don’t initiate to ask for your SSN, bank account information and passwords through email.

 

  1. Know the Warning Signs

Avoid Identity Theft

The IRS released a Taxpayer Guide to Identity Theft (https://www.irs.gov/newsroom/taxpayer-guide-to-identity-theft-1)  to help you confirm if you are a victim.

  • More than one tax return was filed using your SSN.
  • You owe additional tax, refund offset or have had collection actions taken against you for a year you did not file a tax return.
  • IRS records indicate you received wages or other income from an employer for whom you did not work.

We trust you find this information useful to protect yourself from identity theft.

 

If you need help with your tax preparation and filing, contact us today admin@fas-accountingsolutions.com or 832-437-0385.

Avoid Identity Theft

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