By Pam Reiss
There’s nothing easy about doing your taxes. Filling out all those forms and hunting for old receipts is enough to drive anybody crazy. As if you didn’t have enough to concern yourself with during this important time of the year, you can now add another potential peril to the list: tax return fraud.
Tax return fraud is a new form of identity theft that has skyrocketed in recent years. Essentially, the con is pulled off by individuals using your information to file a false return, hoping that the IRS will send them your hard-earned refund. While you’d think that the IRS would be savvy enough to catch these criminals in the act, the agency has been overwhelmed by the frequency of fraudulent returns in recent years.
As of March 5, 2016, the IRS had identified over 42,000 tax returns with roughly $227 million claimed in fraudulent refunds. The IRS has prevented the issuance of an additional $180 million as well. While the agency does have advanced fraud detection capabilities, the evidence clearly demonstrates that they can’t catch everyone. And while the IRS will work with victims to rectify cases of identity theft, it may not be quick enough for someone who was relying on a speedy refund.
So what can you do to reduce your risk? The IRS has provided four simple measures you can take to avoid being victimized:
- For digital interactions use strong passwords and security software with firewalls and anti-virus protection
- Learn how to recognize phishing emails and fraudulent messages from thieves posing as representatives from banks, credit card companies and the IRS
- Do not click links or download attachments from unknown or suspicious emails
- Keep your personal data and records, including your Social Security card, in a secure location
Many individuals don’t realize they’ve been victimized until it is too late. But there are some warning signs that you should keep watch for to catch cases of fraud more quickly.
- More than one tax return filed using your Social Security number
- You owe additional taxes, have refunds offset or have collection actions taken against you for a year you didn’t file a tax return
- IRS records indicate you received wages or other income from an employer for whom you did not work
- The IRS sends you a letter saying it has identified a suspicious return using your social security number
Unfortunately, consumers today cannot sit back idly and enjoy the convenient features of modern banking. They must also be vigilant and fiscally responsible. It may not be fair, but falling victim to identity theft can be incredibly detrimental for the victims themselves. Learn more ways to protect yourself by checking out our Online Learning Center or stopping by The Milford Bank location near you.