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Blog > Identity Theft > What is Tax Identity Theft
 July 13, 2022

What is Tax Identity Theft

Couple working at laptop to resolve tax identity theft

As the Fab Four sang, you can’t avoid the tax man. But if you’re careful, you can avoid tax identity theft.

What is tax identity theft? It’s when someone steals your identity and fraudulently files taxes or works in your name. Translation: someone else can end up with your hard-earned tax refund.

One of the problems with this type of identity fraud is that people often don’t find out about it until it’s too late after they try to file their taxes and are denied by the Internal Revenue Service (IRS).

How can you protect yourself from tax identity theft?

How does tax identity theft occur? The usual first step is that a cybercriminal steals your Social Security number. To minimize the risk, here are a few proactive steps you can take:

  • Safeguard your documents that contain sensitive information. Hide your tax records and other papers with your Social Security number. Once you no longer need those documents, shred them.
  • Avoid online scammers by using an extra layer of security, EG multi-factor authentication, when filing your taxes online.
  • Never give out your personally identifiable information to people who call or email you claiming that they’re from the IRS because they may be fraudsters.

There are a few warning signs to watch for that may indicate that someone has stolen your personal info and is attempting to cash in.

  • You can’t file your taxes because of a duplicated Social Security number.
  • The IRS inquires about a tax return that you didn’t file.
  • You get an IRS notice that an online account has been created in your name, that your existing online account has been accessed or disabled, or that you owe additional taxes or a refund offset.
  • You receive a tax transcript that you didn’t request.
  • The IRS tells you that you got wages or income from a strange employer for whom you didn’t perform any work.

All of these things are red flags that you’ve been hacked and potentially a victim of tax identity theft. The dominoes can start to fall once an online criminal finds your Social Security number. You immediately become more vulnerable to them filing taxes in your name.

What to do when someone steals your identity and tax refund

Thankfully, if the worst happens and someone files taxes using your personal info, here are four steps you can take to minimize the damage.

  1. Get in touch with the IRS at 800-908-4490.
  2. Fill out an IRS Identity Theft Affidavit (sworn statement) found here.
  3. Put a fraud alert on your credit record with the three major credit bureaus (TransUnion, Equifax, Experian).
  4. Contact the Federal Trade Commission and file a complaint here.

IDShield can help

The last, but perhaps most important, step you can take when it comes to protecting your Social Security number and other personally identifiable information is to get identity theft protection from a world-class service, like IDShield. It’s truly the best, most effective way to protect against your tax return being stolen.

IDShield offers best-in-class personal data monitoring, Social Security number monitoring, credit monitoring, and privacy and reputation management and prides itself on its highly qualified team of professionals who won’t give up until your identity is restored. Our industry-leading Licensed Private Investigators will do whatever it takes for as long as it takes to help recover and restore your identity to its pre-theft status.
Sign up today for either 1 or 3 credit bureau monitoring plus one-on-one consultation. IDShield offers a free trial, so there’s no risk. It’s your all-inclusive solution to identity protection, credit monitoring, reputation management and identity restoration.

IDShield is a product of Pre-Paid Legal Services, Inc. (“PPLSI”). PPLSI provides access to identity theft protection and restoration services. For complete terms, coverage, and conditions, please see an identity theft plan. All Licensed Private Investigators are licensed in the state of Oklahoma. This is meant to provide general information and is not intended to provide legal advice, render an opinion, or provide any specific recommendations.


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