While you may be ready to never look back at 2020 again, there is still one aspect of the year left for you to deal with – your taxes. This year, anti-fraud experts are seeing an increase in various types of fraud due to the covid-19 pandemic. With the 2020 tax return season upon us, it’s anticipated that there will be an uptick in tax-related identity theft as well.
Tax identity theft happens when someone steals your Social Security number and files a phony tax return to collect your refund. Often times people don’t know they’re a victim of tax identity theft until they try to file their tax return and the IRS rejects it as a duplicate filing. Another method by which tax identity theft occurs is when scammers pretend to be from the IRS. Scammers will claim that you owe tax money and will then steal your refund and personal information.
To prevent yourself from becoming a victim, follow the below recommendations.
1. Guard your personal information
Make sure personal documents, including your social security number and tax identification number, are locked. Also, make sure any financial software or documents on your computer are password-protected. Create a complex password, and avoid sharing this information or writing it down. If you have financial documents that need disposed of, make sure to shred them.
2. Research your tax preparer
Be sure your tax preparer is a real person and is qualified to handle your financial information. Research your preparer online, and if you’re meeting with them in person, ask to see their preparer tax identification number. You can also verify their CPA status.
3. Never send confidential information over email, text or social media
Often times scammers will try to reach out via email or text explaining that they’ll file a tax return on your behalf if you provide them with the necessary personal information. You should never provide this type of information over email or text. The IRS will never ask for your information via these methods. If you are skeptical of any email, text, mail or other communication, call the IRS toll-free number: 800-829-1040 to determine if the request for information is legitimate.
4. File early
The longer you wait to file your tax return, the greater the odds you’ll fall victim to identity theft. File your return as early as possible. If filing by mail, do so via the post office. Some people prefer to manually fill out their tax forms and file by mail. Mail tampering is a common source of identity theft, so to be safe bring your return directly to the post office. Avoid mailing the return from your home mailbox.
Following the above recommendations will help you to minimize your risk of becoming an identity theft victim. Fully eliminating the possibility of identity theft is nearly impossible, so practice safety when filing your taxes this season!