As stated on its website, identity theft is a significant issue for businesses, organizations, governments, and individuals, including the Internal Revenue Service (IRS). Although progress is being made to prevent identity theft, the situation remains fluid, and fraudsters continue to adapt to new measures. In addition to following official advice and staying informed, you may want to consider an identity theft protection package to reduce your risk of becoming a victim.
If you have experienced tax-related identity theft, where criminals have obtained your Social Security number, filed a false tax return, and stolen your tax refund, you know it can happen quickly. Therefore, it's essential to take preventative measures to protect your personal information and minimize identity theft risk.
Getting help
If you've experienced identity theft, the IRS and other government departments have measures to offer help and assistance. Tax-related identity theft can cause financial hardship, and losing your tax refund to fraudsters can be a big blow. Therefore, it's helpful to know where to look for guidance.
If you inform the IRS that you've been a victim of tax-related identity theft, your case will be assigned to the Identity Theft Victim Assistance Organization or IDTVA. The IRS will assign a specially trained staff member to help with the research involved in your case and resolve matters wherever possible. This will involve several steps to reduce stress levels and limit ongoing damage.
Tracking progress
The IDTVA organization will assign a person to handle your case and assess the situation. They will determine if the identity theft is limited to a single tax year or if it has occurred over an extended period. Additionally, they will address other issues related to the fraudulent tax return, making sure no one else has been implicated in the fraud.
To do this, they will carefully authenticate all names, addresses, and Social Security numbers involved in the case. They will also analyze the situation and check for any outstanding issues that may have occurred as a result of the fraud.
Most importantly, they can assist in ensuring that your tax return is processed accurately and determine if you are eligible for a tax refund. If you are, they will help you receive it as soon as possible.
Practical help
The other benefit of having this sort of ID theft assistance is that it will enable them to mark your tax account with what the IRS calls an identity theft indicator. Not only does this round out the case closure process, but it will hopefully help prevent you from suffering a similar experience in the future.
According to the IRS, you will eventually receive confirmation that your case has been resolved. Often this will be within 120 days, although the government department underlines that more complex cases can take up to 180 days and maybe even longer.
Another aspect of the investigation and case process is that some tax-related identity theft victims get placed into the Identity Protection PIN program, which offers them more protection from fraudsters.
The IRS generally instigates this, but from 2021 there has also been a voluntary opt-in process for the IP PIN program. This does involve passing a series of stringent verification measures, and the IRS outlines the criteria on a dedicated site page.
Additional steps
Following an experience of tax-related identity theft, you might find you’ve got more of an interest in what else can be done to minimize its effects of it in the future. There’s a great awareness campaign currently being run, which is also supported by the IRS, state tax agencies, and the tax industry to highlight issues about this ongoing problem.
Called Taxes. Security. Together, the online hub features all manner of information that, in many ways, is hoping for the public to help the IRS tackle the problem head-on. The website contains news of events and campaigns, including National Tax Security Awareness Week, along with lots of advice.
While there’s valuable information for regular taxpayers, the site also has resources for tax professionals and advice on how they can help fight identity theft from their perspective.
Professional help
Tax professionals can find help and advice on the IRS hub. This resource provides guidance on how to report data theft, protect clients, and prevent data loss. Regardless of the size of your business, it's important to understand your responsibilities. The documentation on the site can help ensure that you have everything covered. If you're unsure about anything, the site provides clear and straightforward information.
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