Posted by The TaxAdvocate Group, LLC

What to do if You're a Victim of Tax Identity Theft

What to do if You're a Victim of Tax Identity Theft

Scammers are everywhere haunting for your tax refunds. They have different tactics to rob unsuspecting victims of their hard-earned money. There are many helpful ways you can prevent yourself from falling victim to scammers.

We want to believe you are aware of those tactics. However, if you have been a victim of tax fraud, there are many things you can do. We will examine eight detailed steps to take. You can take the matter up with various bodies to ensure the scammers do not go scot-free with your money.

This article will guide you for various forms of tax fraud, for instance, if someone you did not know files and received your tax return for you.

File a Paper Return

If the IRS rejects your electronic tax return, consider filing using a paper return. Make sure to include all vital documents to avoid tax penalties, late fees or accrued interest, 

File Form 14039

Form 14039 – the Identity Theft Affidavit will come in handy for victims of tax fraud. Hence, when you get a letter from Uncle Sam, or you suspect someone already has your tax refunds, be sure to complete and mail this form.

The IRS will transfer your case to the Identity Theft Victim Assistance organization that will request additional documents to prove your identity. You will be asked to supply any of the following: social security card, driver's license, or utility bill.

File a Police Report

The next step is to file a police report with the nearest law enforcement agency. While the police will hardly go out in search of the culprit, this effort is essential in other ways. For instance, if the culprit tries to use your identity to rack up debts, the report will help stop it.

Also, in some cases, the fraud could be part of a massive fraud scheme. With additional information from you to the law enforcement agents, there is a considerable probability of closing in and bringing the culprits to book.

If you live in big cities, you might be lucky to have a department specializing in a financial crime or identity theft.

File a Complaint with the Federal Trade Commission 

Although the Federal Trade Commission is not in charge of Crime investigation, they compile statistical info of crime and other data on their website. The aim of this is to help you and other taxpayers. You can log on to to file your complaint

Ask for a Copy of the Fraudulent Return

As long as you are a victim of identity theft, you can receive a copy of the fake tax return filed with your social security number. When you request the information, you will get access to your specific information that was compromised.

Some people might have their wife or child’s Social Security compromised. You can use Form 4506-F to request for the return. 

Examine Your Account Statements and Credit Report

If a fraudster steals your identity, they will use it for many things. In addition to filing a false tax return and collecting your tax refunds, expect other terrible things. With this, be sure that no one charges anything to your credit card, change your account or do anything you did not authorize. Keep passwords to your online account secure and change passwords. Also, get rid of your account information from eCommerce sites.

Freeze all Your Accounts

Contact the three major credit bureaus - Equifax Experian and TransUnion and request a freeze of your account. This will stop any new request for an account with your details. You will, however, have to lift the freeze if you apply for a new mobile device or agree to a credit check.

Request for a Pin for Tax Filing

With an IRS-provided personal identification number, you can add an extra layer of security for your tax filing. Think of it as a two-step verification used on WhatsApp preventing unauthorized access to your account.

Many times, the IRS might invite you to opt-in for this service via mail. Also, filing from some states (Georgia and Florida) automatically qualifies you for the six-digit IP PIN. You have to register with the PIN every year; hence be sure you are ready for it before opting for the service.

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