Monday, March 3, 2014

Tax ID Theft

Maryland, where I call home, is a great state with beaches, mountains, top notch schools and a wide variety of rural vs urban living options. Unfortunately, Maryland also is one of the top states for Tax ID Theft, where someone files a tax return using someone else's name and social security number, usually receiving a hefty refund. Most people don't know about it until they go to file taxes and find out that a return has already been filed.

According to the Federal Trade Commission,  here’s what you can do to lessen the chance you’ll be a victim:  

File your tax return early in the tax season, if you can.

Use a secure internet connection if you file electronically, or mail your tax return directly from the post office.

Shred copies of your tax return, drafts, or calculation sheets you no longer need.

Respond to all mail from the IRS as soon as possible.

Know the IRS won’t contact you by email, text, or social media. If the IRS needs information, it will contact you by mail.

Don’t give out your Social Security number (SSN) unless necessary.

Research a tax preparer thoroughly before you hand over personal information. If you qualify, use the free tax preparation sites which MD CASH Campaign, the non-profit I work for, supports in Maryland. If you use a paid tax preparer, make sure they are registered with the MD Department of Labor, Licensing and Regulation. 

If your SSN has been compromised, contact the IRS ID Theft Protection Specialized Unit at 1-800-908-4490.

Check your credit report at least once a year for free at annualcreditreport.com to make sure no other accounts have been opened in your name.

What if you’re a victim? Tax identity theft victims typically find out about the crime when they get a letter from the IRS saying that more than one tax return was filed in the their name, or IRS records show they received wages from an employer they don’t know. If you get a letter like this, don’t panic. Contact the IRS Identity Protection Specialized Unit at 1-800-908-4490. 

More information about tax identity theft is available from the FTC or the IRS