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Identity theft and refund fraud can occur during tax season when somebody steals key identifying information about a person and uses it to file a false tax return. They can then collect the tax refund.
“It’s another way for people to steal money,” said John Gaccione, the acting director of the Westchester County Department of Consumer Protection. They file a false return and steal the refund, and that can be a huge problem for anybody trying file legitimately.”
The fraud can often go undiscovered until the victim tries to file their own tax return. The Internal Revenue Service will see that a return has already been filed under that social security number, and will refuse to issue a refund.
“If you file a return and they see it’s been filed already, it will set off an alarm, and they’ll have to unravel it from there,” Gaccione said.
“Unfortunately, it can be an overwhelming process to get your identity back,” he said. Gaccione said that if you think you are the victim of identity theft, you should file a police report right away. The IRS will be in contact with your banks, credit agencies, card issuers. Resolutions can take up to six months, and may result in damaged credit or the need for a new social security number.
Gaccione said that identity theft is one of the fastest growing crimes. According to the IRS, they investigated 1,492 identity theft cases in 2013, a 66 percent increase over the previous year.
In order to decrease the risk of identity theft, Gaccione recommends making sure that you have all of your personal documents in order in a secure place. You should also regularly check your credit history to make sure that no accounts have been opened in your name. Make sure that your personal computer is secured with antivirus software and firewalls, and don’t answer any unsolicited emails requesting personal information.
“The Internet makes it easier to open a new account, but it doesn’t mean that the traditional ways of stealing your identity are minimized,” he said. Don’t leave mail sitting in your mailbox during tax season, as thieves can take important documents sent through the mail. Make sure you know which documents your bank and other financial institutions will be sending you during tax season, and contact them if you don’t receive the documents in a timely fashion.
Check out the IRS website for more information on identity theft, and what to do if you are a victim.
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