There's nothing more painful than paying taxes--except getting swindled in the process. But there is some good news. Last year, the IRS managed to stop 1.2 million fraudulent returns claiming $7.2 billion in fake returns.
It doesn't take much for a scammer to take advantage of unsuspecting taxpayers. Having your name, date of birth and social security number is about all it takes. And despite aggressive efforts by the IRS to stop thieves, hundreds of thousands will again fall victim.
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“The first person to file as you, is assumed to be you,” said Alan Brill from Kroll Cyber Security and Investigations. “And then when the real you files, the system says, ‘Now wait a minute, I already did that one.'"
If that happens, act quickly.
“You'll need to contact the IRS right away and fill out an Identity Theft Affidavit,” said ABC News Fixer Stephanie Zimmermann. “Make sure you get a police report, too, to document the crime. The good news is you'll eventually get your refund - the bad news is it could take up to 180 extra days.”
Every year, the IRS warns taxpayers to be on guard for scams, especially during tax season. There are three areas at the top of its list.
- Phone scams: criminals posing as IRS agents threatening you with financial risk, police arrest, even deportation
- Phishing: sketchy e-mails or websites designed to steal your personal information
- Fake tax preparers: setting up shop just to perpetrate refund fraud and identity theft
“If you've been a victim of a data breach, you might do a great job cleaning up your credit report but that won't stop identity thieves from trying to steal your tax refund,” said Zimmerman. “The only way to prevent it is to guard your social security number as much as possible and file your tax return early, to beat the scammers to the punch.”
Never give away your personal information over the phone or over the internet. If you receive a threatening call, hang up.
If an e-mail looks like it's from your bank, credit card provider or the IRS, call that institution first to make sure it's legitimate before providing any information.
It's also a good idea to change your passwords every now and then.