Tax Payers Need to Be Especially Vigilant This Season as Identity Theft Continues to Run Rampant
Infants and Elementary School Children The Favorite Victims, With Child Identity Theft Soaring 300 percent in Five Years
With tax season looming, identity thieves are primed to rip off millions of dollars this year from unsuspecting families by stealing their social security numbers and using it to receive a tax refund. As you prepare to file your tax return, consider the following:
According to Congress’ Government Accountability Office, the IRS detected 642,000 cases of identity theft in the first nine months of 2012, up from 242,000 in all of 2011.
• Last year, the IRS stopped $20 billion in fraudulent refunds from being issued
• The IRS had more than 3,000 employees dedicated to preventing and investigating identity theft-related crimes by late 2012 in the past four years alone, the IRS has identified more than 490,000 taxpayers who are the victims of identity theft.
• In 2011, the IRS found it had identified 2.2 million tax returns that were potentially fraudulent
• Out of those 2.2 million returns, about 940,000 totaling $6.5 billion in claimed refunds were related to identity theft.
• Fraudulent returns fall generally under one of two categories: returns that purport to be from an actual taxpayer claiming a refund to be sent to an address or mailbox controlled by the scammer; or a return with a made up name using a stolen Social Security number — often a child’s stolen identity – a crime that has risen an incredible 300 percent over the last five years.
In many cases, the first time a taxpayer discovers their identity has been stolen is when they file their annual tax return only to see it either denied electronically or returned saying the IRS has a return previously filed for the taxpayer. But for the littlest victims of this crime, how can parents find out if their child’s information has been compromised before wracking up thousands of dollars in debt?
Joe Mason is a leading identity theft expert and author of Bankrupt at Birth: Why Child Identity Theft Is OnThe Rise How It’s Happening Under Parents’ Noses . With nearly 20 years experience in credit and identity fraud protection, Mason, the father of two young girls, offers taxpayers important advice on how to protect their entire family from falling victim to identity thieves.
• TAX TIPS: Five tips for a safe and secure tax season
• WARNING SIGNS: Find out important warning signs that your child’s identification has been compromised
• PREVENTION: Learn how you can protect your family year round from identity theft
• ACTION: Important tips on what you can do if a family member’s identity has been stolen.
5 TIPS FOR A SAFE SECURE TAX SEASON
• Be suspicious of any calls or emails purporting to be from the IRS – the IRS will always write to you first, will rarely call, and will never email you.
• Safeguard your Social Security number: Never confirm your Social Security number or bank account details by email or over the phone, unless you are initiating the call. Always ask if you can provide a different form of identification.
• Do not use public wi fi to access tax files: If using an online tax preparation software, never access your account through public wi-fi. Instead, use your carrier’s cellular service.
• Beware of computer viruses: Make sure your computer is free of malware like computer viruses and spyware that can steal a copy of your SSN or bank account password.
• Be sure to monitor your credit report after tax time to ensure no fraudulent activity has occurred. Additionally, to protect yourself all year round, consider enrolling in an identity theft protection service like Identity Guard that proactively monitors your personal and financial information to help you stay aware and alert.
WARNING SIGNS – CHILD IDENTITY THEFT
• Unsolicited Credit Card Offers: Your child may start getting unsolicited offers for credit cards. If this happens to your child, take this as an indication that something could be seriously wrong. The answer may be that a credit file or a marketing list exists somewhere on your child.
• Your Child is Contacted by a Collection Agency: If a collection agency tries to collect on a debt related to your child. In more serious cases, you may end up at the emergency room only to find out your child has a long health record on file with Medicaid or Medicare or with a major health insurer.
• Credit Applications Denied: The first time a child or parent becomes aware that the child’s Social Security number has been stolen is when the child attempts their first credit transaction
• First Visit to DMV: Taking your teenager down for a driver’s test and first license only to realize she is just handed