Numerous warnings have been issued in an attempt to forestall financial identity crimes. However, thieves repeatedly find new ways to vex victims. One attack plan involves the filing of fraudulent tax refund claims using stolen personal data. Stay safe this tax season by knowing what immediate action to take if you suspect identity theft.
Warning Signs of Tax Return Identity Theft
Be alert to possible tax return identity theft if you receive a notice from the IRS or your tax professional.
- More than one tax return was filed in your name;
- You have a balance due, refund offset, or collection actions for a year you did not file a tax return.
- IRS records indicate you received more wages than you actually earned.
- Your state or federal benefits were reduced or canceled because the agency received information reporting an income change. Should you receive a notice from the IRS, and you suspect fraud, respond immediately by calling the number on the notice.
What to Do if You Suspect Identity Theft
If you did not receive an IRS notice but believe you were the victim of identity theft, contact the IRS Identity Protection Specialized Unit at 800-908-4490 so they can take steps to secure your tax account and match your SSN or Individual Taxpayer Identification Number (ITIN). If you are a victim of theft, do these things now:
- Contact the Federal Trade Commission (FTC) to file an Identity Theft Affidavit and create an Identity Theft Report. You can file your report online, by phone (toll-free): 1-877-ID THEFT (877-438-4338) or by mail — 600 Pennsylvania Ave., Washington DC 20580. The FTC will provide you with information about what to do next, depending on what type of fraud was (or may have been) committed.
- To complete the Identity Theft Report, you’ll need to contact your local police department and report the theft. Be sure to get a copy of the police report or report number. Both your police report and the FTC Identity Theft Affidavit combine to create your Identity Theft Report. Your Identity Theft Report will help you when working with the credit reporting agencies or any other companies the identity thief may have used to open accounts in your name.
Protecting Your Social Security Number
Protect Your Social Security Number. Should your social security number become compromised, contact the Social Security Administration (SSA) (800-269-0271) and the IRS (800-829-0433).
It’s important to talk to the SSA if you have reason to believe your social security number has been compromised, even if you don’t yet see any evidence of financial fraud. A thief could be planning to steal your tax refund or to obtain employment in your name.
Protecting Your Mail
In addition, if you have reason to believe the identity thief may have submitted a fraudulent change-of-address to the post office or has used the U.S. mail to commit the fraud against you, contact the Postal Inspection Service and complete an online form. This organization serves as the law enforcement and security branch of the post office.
Protecting Your Credit Report
- If you see any fraudulent activity on your credit reports, contact those creditors immediately to let them know. They’ll each have their own processes for working through fraud issues.
- Take a proactive approach: Put a fraud alert on your credit report. A fraud alert puts a red flag on your credit report and notifies lenders and creditors that they should take extra steps to verify your identity before extending credit. You can do this at any time, and for any reason; you don’t need to wait until you are a victim. To place a 90-day fraud alert on all three of your credit reports, you only need to contact one of the three credit reporting agencies (Experian, Equifax, or TransUnion). When you place the initial alert, they will automatically notify the other two agencies for you.
Freezing Your Credit Report
Another option—and a more effective identity theft prevention measure—is to place a security freeze on each of your credit reports. A freeze prevents creditors (except those with whom you already do business) from accessing your credit reports at all. New applications will automatically be declined. With a security freeze in place, you will need to take extra steps to apply for new credit. Each agency has a procedure for temporarily “thawing” your file in order to allow a legitimate application to be processed. Unlike a fraud alert, you’ll need to contact each agency individually to place a freeze on each of your reports.
Get Your Free Report
When you place a fraud alert on your credit reports, you’re entitled to a free copy of your credit report from each agency. Be sure to obtain them. If you find fraudulent items on your credit report(s), the simplest way to begin the dispute process is to click the item while viewing your credit report online. You must dispute some items in writing and with supporting documentation. You cannot dispute Some types of credit inquiries. However, they may give you a clue as to where a thief has applied for credit in your name. Initial fraud alerts are free and remain in place for 90 days. In some cases, security freezes and extended fraud alerts incur a small fee, but these services are free to victims of identity theft.
Feel free to share this information with others who may find it helpful, or reach out to SYM Financial at 800-888-7968 if you suspect a problem with your accounts.
Disclosure: The opinions expressed herein are those of SYM Financial Corporation (“SYM”) and are subject to change without notice. This material is not financial advice or an offer to sell any product. SYM reserves the right to modify its current investment strategies and techniques based on changing market dynamics or client needs. SYM is an independent investment adviser registered under the Investment Advisers Act of 1940, as amended. Registration does not imply a certain level of skill or training. More information about SYM including our investment strategies, fees, and objectives can be found in our ADV Part 2, which is available upon request.