MSU Extension MI Money Health

Imagine filing your annual tax return, only to have it rejected by the Internal Revenue Service (IRS) because it had already been filed. The good news is you are not suffering from memory loss. The bad news is that you may be a victim of tax identity theft. The incidents of fraudulently filed tax returns have steadily increased. Given the repeated occurrences of data breaches, we are all potential victims. According to the IRS, in 2013 alone, more than 5 million tax returns were filed using stolen identities. Although the IRS has been able to decrease the number of taxpayers victimized by identity theft recently, the threat is still there.   

How do you know if you are a possible victim of identity theft? First of all, if you believe your social security number has been compromised, then you are a potential victim. Another warning sign is if you receive any IRS correspondence stating that:

• Your social security number has been used to file more than one tax return;
• You did not file taxes one year but you owe additional taxes, a refund offset, or had collection action taken against you for that year;
• IRS records indicate you received wages from an employer unknown to you.

There are numerous steps to take if you become a victim.

• Contact your local police department, as soon as possible.
• Go to www.identitytheft.gov to file a complaint with the Federal Trade Commission (FTC) or call the FTC Identity Theft Hotline at 1 (877) 438-4338 or TTY 1 (866) 653-4261.
• Contact one of the three major credit bureaus immediately. You will need to place a ‘Fraud Alert’ on your credit report:
  • Equifax – 1-800-525-6285
  • Experian – 1-888-397-3742
  • TransUnion – 1-800-680-7289
• Close all accounts that were opened without your permission or existing accounts that show evidence of misuse.

The process of cleansing your identity is task-driven and lengthy but necessary. If you suspect that your social security number has been fraudulently used, there are additional steps.   

• Call the IRS, immediately, after receiving any IRS notice. The number to call will be included in the correspondence.
• Complete the Identity Theft Affidavit, IRS Form 14039. Then print and mail or fax according to instructions.
• You must continue to pay your taxes and file your tax return, even if you must do so by paper.

There are ways to increase your chances of avoiding taxpayer identity theft:

• Do not routinely carry your Social Security card or any document with your social security number on it.
• Do not give a business your social security number just because they ask – only when absolutely necessary.
• Protect your personal financial information at home and on your computer.
• Check your credit report annually. Go to www.annualcreditreport.com or call 1-800-322-8228 to get a free copy of your credit report.
• Check your Social Security Administration earnings statement annually. Your earnings statement can be accessed at www.ssa.gov .
• Protect your personal computers by using firewalls, anti-spam/virus software, update security patches and change passwords for Internet accounts.
• Do not give personal information over the phone, through the mail or the Internet unless you have either initiated the contact or are sure you know who is asking.

Have you already contacted the IRS and your issue has not been resolved? Contact the Identity Protection Specialized Unit at 1-800-908-4490. This unit was started in 2008, to assist taxpayers in reporting tax identity theft and working directly with the IRS to resolve their concerns.

Michigan State University Extension educators want all taxpayers to know that the IRS will never initiate contact with taxpayers by email to request personal or financial information. This includes any type of electronic communication, such as text messages and social media channels.