Protecting Yourself from Identity Theft
May 2012
Identity theft is on the rise. This new form of criminal activity makes it important for you to protect your confidential information by regularly checking your credit reports, bank statements, and credit card statements for any fraudulent activity. However, one area that you may not have realized that can be affected by identity theft, is your tax filings with the IRS.


For tax year 2010, the IRS reported that 1.6 million tax returns were fraudulently filed, many with existing person's social security numbers. More than 850,000 of these fraudulently filed returns requested refunds totaling $5.8 billion. It is estimated that these numbers will increase by five times for the 2011 tax year.

How is identity theft occurring?

The IRS issued notices FS-2012-7 and FS-2012-8 warning taxpayers that criminals are using stolen identities to report false income and withholdings to file a fraudulent tax return and claim a refund.  The legitimate taxpayers often do not become aware of the situation until they attempt to file their return and it is rejected because a fraudulent one has already been filed. 

Resolving this issue can take a year or more to complete and causes numerous problems for the taxpayer: incorrect IRS notices, delayed refunds, undue burden, and earnings record problems with the Social Security Administration.

Pointers on how you can protect yourself.    
  • Do not carry your Social Security card with you
  • Check your credit report from all three major crediting reporting agencies, at least, once a year
  • Shred all documents that you dispose of that may contain personal information, such as credit card applications, insurance forms, physician statements, and bank statements
  • Remember: the IRS will NEVER initiate contact with you by e-mail to request personal or financial information.  Never respond to a email appearing to come from the IRS.
  • Enroll in a credit protection service that monitors your credit, offers insurance for identity theft, and provides fraud resolution support; below are examples of a couple different services:
  • Review your Social Security Earnings and Benefits Statement to check for fraud
    • If you have not received one lately, call 1-800-772-1213 or order the Earnings Statement on the SSA Website
  • Request IRS tax return transcripts to review your tax return data and verify that the data has been correctly stated
    • To request a copy of your transcript, call 1-800-908-9946, or visit the IRS Website
  • Check with your insurance provider to ensure that your business insurance covers claims filed for identity theft 
What to do if you are a victim of identity theft. 
  • If you receive a written notice from the IRS, respond immediately
    • Fill out the IRS Identity Theft Affidavit, Form 14039
    • Please contact us if you need assistance in preparing Form 14039
  • Immediately place a fraud alert on your credit report by calling one of the following:
    • Equifax 1-888-766-0008
    • Experian 1-888-397-3742
    • TransUnion 1-800-680-7289
  • Contact the Federal Trade Commission
  • Contact the IRS Identity Theft Protection Unit
    • 1-800-908-4490
  • File an online complaint with the Internet Crime Complaint Center (IC3)
  • File a police report

Please contact us with any questions you may have regarding identity theft, if you have received a notice from the IRS about identity theft, or you think you may be a victim of identity theft, and we will assist you in deciding which steps to take next.

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Soukup, Bush & Associates, PC 
(970) 223-2727