Nearly two-thirds of individuals express concern that they will be targeted by scammers seeking to steal their personal information to file fraudulent tax returns, according to a survey by Allstate Insurance. Tax identity theft happens when a fraudster files a fake tax return using someone else’s Social Security information, with the goal of illegally obtaining a tax refund. Resolving tax refund theft typically takes around 22 months, but there are preventative measures taxpayers can take to minimize their risk.
Financial experts advise filing your tax return as early as feasible to reduce the timeframe a fraudster has to file a return in your name fraudulently. The deadline to file a tax return for 2024 income is April 15. The Internal Revenue Service (IRS) also suggests getting an Identity Protection PIN (IP PIN), a six-digit number provided by the IRS that’s attached to your tax return. Victims of tax-related fraud must use this number on subsequent tax returns. Taxpayers can also proactively request an IP PIN for added security.
To request an IP PIN, visit the IRS website. You will receive a new IP PIN by mail each year.
Maintaining healthy internet habits can help prevent fraud. Always use strong passwords for your online accounts that are difficult to guess. If you regularly file taxes online, it’s important to avoid clicking suspicious links and consider using anti-virus software.
