Photo (cc) by 401(K) 2013
Imagine filing your federal tax return, only to find out someone already beat you to the punch – and claimed a tax refund in your name. Many thousands of Americans fall victim to this type of tax-related identity theft every year.
It’s happened to Atlanta resident Kenyatta Solomon for two years in a row, WSB-TV said. Even though Solomon had her account flagged with the IRS, as well as a special personal identification number she needed to file, an ID thief was still able to pocket a return by using her name and other personal information. According to WSB-TV:
“It’s very frustrating, especially when they say they have all these things in place and they’re supposed to be able to protect you,” Solomon said.
Now that it’s happened twice, Solomon won’t be able to file her taxes electronically anymore. The first incident stalled her $5,000 refund check by several months.
We recently had a post about how to keep this from happening to you. Here are some tips from us and from MarketWatch:
- Have your refund direct-deposited into your bank account. It’s a little late for this now, but MarketWatch suggests you file as early as possible.
- As soon as you realize that a fraudulent return has been filed in your name, call the IRS at (800) 908-4490. You will also need to complete Form 14039, which is an identity theft affidavit.
Then report the incident to the Federal Trade Commission and set up a fraud alert with the major credit reporting agencies, MarketWatch says. It’s easy to do.
It appears that tax return identity theft is quite lucrative. According to CBS Denver, “Federal officials estimate the IRS could issue some $26 billion in fraudulent tax refunds in the next few years if the agency doesn’t increase security.”
Have you or someone you know been a victim of tax return identity theft? Share your comments below or on our Facebook page.