Follow Adam Linkedin Twitter Facebook
Email Adam Email
Financial
May 1, 2017

Protect Against Tax Identity Theft

Sponsored Content provided by Adam Shay - Managing Partner, Adam Shay CPA, PLLC

While not widespread, we definitely see cases of income tax identity theft each year. 
 
The way the scam typically works is that criminals steal someone's social security number via a data breach, carelessness with personal information, or a phone scam. They then submit false information on income tax returns to generate a large income tax refund. 
 
Eventually, enough people report the issue, hopefully the government tracks them down, and the criminals get arrested.  The government is also implementing preventive measures, such as trying to do timely and better data matching with information reported on income tax returns. As long as it's an easy fraud that takes a long time to track down, criminals will continue to pursue this scam.
 

How Do You Protect Yourself From Income Tax Identity Theft?

Be sure to secure your personal information. Do not send or share identity information insecurely via email or other means. 
 
Consider using a free service such as Credit Karma or free credit reports from the three credit agencies to monitor changes to your credit. While income tax identity theft may precede credit identity theft, catching credit identity theft will let you know you are susceptible to income tax identity theft.
 
Don't fall for phone scams. Neither IRS agents nor state revenue agents will demand payment or personal information via phone calls. It's one of the many phone scams that can be used to get your personal information.
 
If you want to be proactive and you meet qualifying conditions, you can voluntarily apply for an IRS IP PIN, which is a six-digit code that changes each year and must be submitted with your tax return. If a return requires the number and is submitted without it, then it is automatically rejected by the IRS.
 

How Do You Know If You've Been A Victim Of Income Tax Identity Theft?

The way you typically know is your electronically filed income tax return rejects out and indicates you have previously filed a return.
 

What Do You Do If You've Been Subjected To Income Tax Identity Theft?

If you suspect you've been subjected to income tax identity theft, you should contact the IRS immediately. You will be required to paper-file your tax return. If you know the issue to be identity theft, you should file an IRS Identity Theft Affidavit and pursue getting an IRS IP PIN for future years. A tax professional can really help in these situations.
 
The purpose of this article was to make you aware of income tax related identity theft, ways to prevent it, and what to do if you experience it.

Adam Shay, CPA (N.C. License Number 35961), MBA, is managing partner of Adam Shay CPA, PLLC. He focuses on minimizing taxes and improving the financial results of entrepreneurs, and is actively involved in supporting the Wilmington entrepreneurial and startup community. For more information, visit http://www.wilmingtontaxesandaccounting.com/ or email him at [email protected]. He can also be reached by phone at (910) 256-3456.
 

Other Posts from Adam Shay

Adam shay blk 52015121549
Ico insights

INSIGHTS

SPONSORS' CONTENT
Web awstaffpic2020 1 132245438

The Luncheon for Literacy: More than a Meal

Alesha Edison Westbrook - Cape Fear Literacy Council
Chris coudriet

A Public Service Profile on Community Connections

Chris Coudriet - New Hanover County Government
Dane

A Simple Approach To Difficult Conversations

Dane Scalise - GriffinEstep Benefit Group

Trending News

Affordable Housing Investors Buy Lakeside Villas In $29M Deal

Staff Reports - Jan 26, 2023

Work Continues On Covey, Envisioned As Midtown’s Neighborhood Nest

Miriah Hamrick - Jan 25, 2023

The Half Takes A Bite Out Of New Markets With Second Location

Miriah Hamrick - Jan 25, 2023

City To Begin Due Diligence On Potential Thermo Fisher Building Purchase

Johanna F. Still - Jan 25, 2023

Novant NHRMC Unveils Its Neurosciences Institute

Staff Reports - Jan 25, 2023

In The Current Issue

Preserving Wealth, For Family And History

Plans for major improvements fell by the wayside, delayed by life and the home’s overwhelming degree of deterioration, which placed the prop...


New App Hooks Seafood Connections

Landon Hill is the founder and owner of the mobile app that seeks to promote local fishers and make it easier for buyers to find fresh seafo...


Local, State Efforts Target Service Sector

Many industries have started to recover from the roiling effect the pandemic had on the labor market, but nearly three years after the first...

Book On Business

The 2023 WilmingtonBiz: Book on Business is an annual publication showcasing the Wilmington region as a center of business.

Order Your Copy Today!


Galleries

Videos

2022 Power Breakfast: Wilmington's Most Intriguing People - Spence Broadhurst & Hannah Gage
2022 Power Breakfast: Wilmington's Most Intriguing People - George Taylor
2022 Power Breakfast: Wilmington's Most Intriguing People - Mike Ford
2022 Power Breakfast: Wilmington's Most Intriguing People - Meaghan Dennison
2022 Power Breakfast: Wilmington's Most Intriguing People - Rhonda Bellamy