Tax fraud is a common phenomenon. It happens every year. Fraudsters are there in every field, similarly there are tax fraudsters who are constantly looking for ways to steal your personal information, so that they can file tax returns in your name.
Basically, there are three main methods of stealing your personal information. They include phishing scams that deceive people to give out their personal details or account information, fraudsters rehashing account passwords that usually people replicate from their other accounts and security breaches that expose personal information of customers.
Getting out from a tax fraud is a lifelong and painful process. However, with correct means you can make your situation better. One strategy to avoid tax fraud is by filing tax refunds as soon as possible. This can eliminate tax frauds and can beat scammers in their face. Other than this, tax fraud victims can follow these five steps.
As soon as you spot a tax fraud, you should report it immediately to the identity protection section of the IRS. You should directly report to them. Tax fraud victims are required to fill up an Identity Theft Affidavit, in order to make an alert for their account. They can even be asked to file their tax refunds on paper. In the meanwhile, the IRS works to verify their identity. After this, the IRS issues an identity protection pin to identity theft victims, which they are required to submit, together with their Social Security numbers, at the time of filing their tax returns. Additionally, tax fraud victims can also file their complaints with FTC or report the scam to their local police department.
It’s a nice idea to frequently change passwords of your financial accounts. Ensure that each password is different from the other. Your passwords should be lengthy. They should be a combination of letters, numbers, and symbols. Additionally, you can even fake your password recovery questions. This can be much safer, as a scam artist can easily come to know about your birth city. However, for this you need to remember your false answers, in case you forget your password.
Apart from this, tax fraud victims can benefit from other security measures, in order to keep their financial accounts safe and sound. For instance, multi-factor authentication that asks users to give a code or any other type of information, along with their password at the time of new registration. These codes are often sent to your cell phone or e-mail. This means that tax fraudsters would have to access your e-mail or steal your phone, as well as figure out your account password. You may feel this extra step will unnecessarily consume your time, but when it’s about securing your financial accounts, or even your healthcare accounts, you should definitely take advantage of it.
A tax fraudster who has filed a fake tax refund in your name can also try to open new credit card accounts or take loans, using your Social Security number. In order to curb this practice, tax fraud victims should check their credit reports occasionally, so that they can know about any account which is opened in their name.
Additionally, identity theft victims should opt for credit alerts from the three chief credit reporting bureaus, Equifax, TransUnion, and Experian. This will inform them about the scammer who applies for credit in their name, while using their Social Security number. Tax fraud victims can even freeze their credit account, so that no one gets to pull out their credit report, making it much more difficult for tax fraudsters to open accounts using their name.
Whenever there is a high profile tax fraud, other scam artists try to benefit from the situation by trying their schemes on worried consumers or victims. Tax fraudsters can pretend to belong to a particular company and ask you to confirm your personal information.
For instance, some time back there was an increase in the number of tax fraudsters who pretended to be from the IRS. They used to call taxpayers and terrify them into believing that they have not paid back their taxes, by saying that they can even land up in jail, if they don’t pay their taxes. However, the IRS does not e-mail or call taxpayers to ask about any personal information. If you feel that you owe some money, you should check IRS.gov, rather than replying to such fake calls or emails.
A typical case of tax fraud takes almost 120 days to resolve. And, if the victim proves his or her identity, then also a credit scam can be a long-lasting problem for tax fraud victims. This requires tax fraud victims to be patient. Moreover, they should regularly check on their credit reports for any loans or accounts opened in their name.
Asharp Bookkeeper