How to Protect Yourself from Tax Identity Theft
Putting a freeze on your credit will not prevent a fraudster from carrying out a tax refund crime in your name. Furthermore, the other glitches with a freeze (though it is a very good way to help protect you against new account fraud) is that it doesn't protect against medial identity theft or credit card fraud. Identity theft protection services won't protect against these either. But the right comprehensive service will restore a compromised identity, including tax identity theft. Do your research.
So how can you protect yourself from tax identity theft?
- Once the 2016 tax filing season starts, jump into action and immediately file your federal and state taxes. Do not put it off, even if you think you owe big.
- Request a copy of your credit report. It's free. Get it from TransUnion, Experian and Equifax. You can get them all at once from all three or get it once every four months from each agency. Do this at AnnualCreditReport.com
- Carefully inspect your credit reports for anything that looks fishy or unfamiliar, such as employment somewhere where you never worked. If you don't want to hassle with this, have a credit monitoring or identity theft protection service do it.
- If you want to freeze your credit, do so sooner than later. This reduces risk regardless of the kind of identity theft.
- Request an IP PIN from the government. What's an IP PIN? An IP 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 can't use an IP PIN as your e-file signature PIN.
- File form 14039. To get this form you must report that you think you are at risk for having your identity stolen. You can report this even if nobody has actually tried to victimize you. After all, just about everyone has had at least a wee bit of experience that could lead to identity fraud. With millions to billions of records stolen over the last decade, consider your identity compromised.
If You Are Victimized
- Request a copy of the fraudulent tax return.
- To do that, you will need to file a form 4506 (this comes with a $50 fee).
Get the local police involved. Give them a copy of your copy of the phony tax return. The police may be able to hunt down criminals who are involved in the crime against you. But probably not.
Robert Siciliano is an identity theft expert to BestIDTheftCompanys.com discussing identity theft prevention.
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