Hopefully this will never happen to you but in the unfortunate event you become of victim of tax fraud there are some steps that you can take to help alleviate the concern that someone has stolen your identity to file a fraudulent tax return in order to receive the refund.
Generally, the first sign of fraud appears when you try to file our return electronically. Most e-file providers receive acknowledgements from the IRS that the return was successfully e-filed. If a return is rejected, a code will return with the rejection indicating what the issue is. For example, a sign of fraud will indicate that the Social Security numbers used to file your return were previously used in the same tax year for another return. If you know you didn’t previously file, then fraud is likely.
If you feel you’re the victim of fraud, here’s what you can do:
- Contact the IRS immediately and let them know you feel you’re the victim of fraud.
- Generally, you won’t be able to e-file so instead you’ll paper file your return. You or your tax preparer can provide a statement as to why you’re paper filing and that you feel you’ve been a victim of fraud.
- Review all of you outside accounts and information to see if you can detect where the culprit got your information. Consider changing passwords and or limiting access to what information you provide.
Lastly, this is directly from the IRS:
The IRS has security measures in place to verify the accuracy of tax returns and the validity of Social Security numbers submitted.
- If you receive a notice from the IRS that leads you to believe someone may have used your Social Security number fraudulently, please notify the IRS immediately by responding to the name and number printed on the notice or letter.
- If you are an actual or potential victim of identity theft and would like the IRS to mark your account to identify any questionable activity, please complete Form 14039(.pdf), Identify Theft Affidavit. Mail or fax the form to the address or fax number listed on the notice with your tax return if your electronic filing was rejected or to the address/fax located in the instructions.
- You may also contact the IRS’s Identity Protection Specialized Unit (IPSU) at 800-908-4490. IPSU employees are available to answer questions about identity theft and resolve any tax account issues that resulted from identity theft.
- Review Publication 4535(.pdf), Identity Theft Prevention and Victim Assistance, for more information. It is available in both English and Spanish.
- If you suspect someone else is using your Social Security number, or to secure information on how to prevent identity theft, you can contact the Federal Trade Commission (FTC) Identity Theft Hotline toll-free at 877-438-4338.
Hopefully this never happens to you, but if it does, there’s a way to fix it.