Tax ID theft is a growing problem. It occurs when someone uses your stolen Social Security number to file a fraudulent tax return claiming a refund. The ID Thieves try to file early in the tax season using fake documents so they get the refund before you get your returns filed. You may be unaware that this has happened until you efile your return and discover that a return already has been filed using your SSN; or your tax preparer may notify you that a tax return was already filed or attempted in your name; or, the IRS may send you a letter saying they have identified a suspicious return using your SSN. If you suspect you are a victim of identity theft, continue to pay your taxes and file your tax return on paper.
Here are steps to take if you suspect you are a victim or attempted victim of Tax ID Theft:
**File your current taxes on paper. Your CPA or Accountant should provide instructions on filing your tax returns in paper form attaching a form 14039. Visit the IRS website at http://www.irs.gov/pub/irs-pdf/f14039.pdf. In the past, the IRS, has said victims had to submit a paper return along with the form 14039, a copy of state issued ID of person whose SS was used fraudulently, and a copy of the related police report. http://www.irs.gov/uac/Taxpayer-Guide-to-Identity-Theft.
(Get a notebook or something to keep all the information together before you start.)
- Call FTC Identity Theft Unit – 1-877-438-4338 and file a report. They will give you a reference number for your report – write it down. You will need to call them back at a later time and provide case number of police report.
- File a police report with your local police. Give the police the reference number you received from the FTC. Ask when the police report will be available and get a copy when it is ready. Call the FTC back with the police report information when you have it.
- Call one of the three credit reporting agencies and let them know you have been the victim of Tax ID fraud and place a fraud alert on your credit report. Make sure you write down the fraud alert verification #. They will notify the other two credit bureaus – you only have to call one. Fraud alerts only lasts 90 days unless you send the police report later. http://www.consumerfinance.gov/askcfpb/1375/i-may-have-been-victim-fraud-or-identity-theft-how-can-i-put-fraud-alert-my-credit-report.html .
- Get copies of your credit reports from all three bureaus and review them for fraud or errors – you should be able to get them free with a police and FTC report, or just use your free annual credit report by going to http://www.consumer.ftc.gov/articles/0155-free-credit-reports and calling the phone number listed or using the mailing order form. Correct any errors other than address mistakes – by mail, not by using the credit bureau online dispute service (or do both). You can find sample dispute letters online.
- Check with your bank and credit card companies to make sure no one has accessed your accounts.
- Consider freezing your credit report. Once you have the police report and FTC report – send copies and other required documentation to all three credit bureaus to freeze your credit reports. See blog entry for more information about freezing your credit report.
- Contact any government agencies that may be interested in the Identity Theft such as the State Attorney General’s office, if there was any mail fraud, the Postmaster General, etc.