Identity Theft at Tax Time
With tax time here again, it’s a good time to talk about Identity Theft. If you have been following my posts on Facebook, Twitter, and/or my Blog, you may have read about the importance of this issue. During this time of year, an increasing number of people are learning that they are not getting their tax refund this year because someone else already has claimed it. I've shared numerous news stories concerning this growing crime and how the IRS is attempting to stem the tide.
Identity Theft By The Numbers
Identify theft presents obvious issues, not only for the individual victim, but to the government as well due to the strain it causes on our government’s accounting. According to the Wall Street Journal, the number of tax identity theft cases grew from 51,700 in 2008 to more than 1.1 million in 2011. The burden on the individual victim is clear - months of waiting and having to prove your identity and that you are entitled to the refund for the tax return you have filed. This delay in receiving planned refunds will impact many people that count on these monies to pay bills, make delayed necessary repairs, or take a vacation.
E-Filing Comes With Increased Risk
While electronic filing has cut down on paper and delays in getting to and being processing by the IRS, it has also allowed thieves to get the quick jump on filing and receiving tax refund-loaded debit cards before the rightful owner receives them. Because the IRS does not verify or compare names on bank records against their own records, thieves can even have refunds deposited into their special accounts. The information needed to accomplish this theft is easy to obtain - it does not require hacking into your computer or stealing your wallet. The necessary information is given to people and businesses all the time without thinking if that information is secure.” I would hazard a guess that most people throw away documents that contain identifying information without shredding them or giving it much thought. These tax-refund thieves can even get your refund while siphoning off additional false refunds attached to your filing of which you know nothing about…that is until you are audited. If you receive an IRS notice that your income was unreported, your identity is probably being used for someone else’s employment as well as their filing for a refund.
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