IRS offers taxpayers ID theft prevention tips

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The IRS cautions taxpayers not to give their personal information to strangers because it may put them at risk of having their tax returns stolen, among other dangers.

During an interview Aug. 1, IRS spokesman Bill Brunson said the agency is committing more personnel and computer resources to combat identity theft. He noted people still click on spam emails and end up giving their Social Security numbers, as well as other information, to unsavory characters who use the information to file fraudulent tax returns.

Brunson said many times the scammers use Social Security numbers from people who have died, as well as from youngsters who don’t yet have filing requirements.

“So there’s a number of years that the bad person can, say, go to the well,” Brunson said.

Brunson said he’s also seen instances of a taxpayer experiencing recurring problems with a scammer filing fake returns in their name year after year. In such instances, the IRS can issue the person a special taxpayer number to use in filing their income tax return. That way, even if a criminal has access to the person’s Social Security number and other information, it won’t do them any good because the specially issued number is required to file the return.

Special Agent Brian Watson, spokesperson for the IRS Criminal Investigations Division, said the fraud has been rampant in Florida, although there are cases all over the country. Such scams are also perpetrated from countries outside the U.S. He said the IRS has dedicated more agents to work the cases, and people are getting caught and going to prison.

Watson said the IRS has found many of the perpetrators have a history of other illegal activity, more street level crime, and they venture into white collar crime like stealing people’s tax returns.

“They think it’s safer — you know, you’re not going to get shot, you’re not going to get beat up, you can do it from the safety of your house or from a laptop anywhere,” Watson said. “But they’re going to jail for it. People are getting some pretty big sentences, especially if they have a prior criminal history.

“It’s a problem and we’re going to see it again this year. We’re going to have to attack it even harder this year.”

Brunson said the IRS established a special unit for people to report cases where they believe their identity was stolen. People who have had their purse or wallet stolen, or who have noticed questionable activity on their credit cards or credit report, should call the IRS Identity Protection Specialized Unit at 1-800-908-4490.

Brunson urges people not to share personal financial information with “just anybody” or carry their Social Security card in their wallet.

“Shred your documents,” Brunson said. “Do commonsense things that could prevent ID theft.”

Watson said if a person has their identity and tax return stolen, the victim will get their money back. However, it could take six months.

“And it’s a hassle,” Watson said.

Watson added the experience is stressful, and people are best to avoid it in the first place. He urged people not to open spam emails with subject lines such as “Please contact me regarding your ATM card.” He warned they are often just a ruse to initiate contact with a victim, and too often people end up providing their Social Security number or other information to the scammers.

“People fall for stuff like that, and then that’s how they get the numbers,” Watson said.

Watson said the IRS has seen a major increase in identity theft cases over the past 10 years. Brunson agreed.

“Ten years ago, this was a nominal issue. It wasn’t really recognized by the Internal Revenue Service as a problem,” Brunson said. “And that’s where you could see a taxpayer have an issue from one year to the next, because there wasn’t really any thought going to what was happening.”

Brunson said over time, as technology and computers became more prevalent, identity theft has proliferated.

Watson noted the IRS could set up the tax return system to prevent all fraud, but then it would take an especially long time to process refunds. He said the agency must balance fraud concerns with taxpayers’ need to receive their refunds in a timely manner to meet their expenses.

Brunson said the agency is doing more extensive checking, however. He noted electronic filing used to be advertised to process refunds in 10 days or fewer, but now 21 days or so is the estimated time frame.

“It can happen in 10 days or less, but we’re doing more things up front and checking for fraud,” Brunson said.

An IRS brochure titled “Identity Theft Prevention and Victim Assistance” recommends that taxpayers:

  • Don’t give out Social Security numbers to a business just because they ask, only when absolutely necessary.
  • Check their credit report every 12 months.
  • Protect personal computers by using firewalls, using anti-spam/virus software, updating security patches and changing passwords for Internet accounts.
  • Don’t provide personal information over the phone, through the mail or on the Internet unless you are sure you know who you are dealing with.
  • Visit the IRS website at IRS.gov and enter “identity theft” or “phishing” in the search field for more information.