It’s no secret that identity theft is a serious and growing problem. One particularly fruitful area for identity thieves is tax fraud. The Treasury Inspector General for Tax Administration, Russell George, recently testified before Congress on this issue. Mr. George reported that, for 2010 alone, millions of fraudulent tax returns resulted in an estimated $11.7 billion in refund claims.
The typical tax fraud begins with a thief obtaining someone else’s Social Security number, then using that number to open a bank account and obtain a debit card. The thief then files a false return claiming a refund early in the tax season. The thief’s hope, too often realized, is that the IRS will send out the refund before the real taxpayer has filed his or her own return. Once the refund arrives in the thief’s bank account, it is quickly withdrawn via the debit card. The real taxpayer won’t find out about the fraud until later, when the true return is rejected because the taxpayer’s Social Security number has already been used that year.
Tax scammers use a variety of means to obtain Social Security numbers and other personal information. Mr. Russell reported in his testimony that an increasingly common method is the use of fake IRS websites. In 2006, the IRS found 245 false sites. In 2012, they expect to find over 20,000! A thief using this method will typically send out an email with a link to a fake IRS site. Once an unsuspecting individual clicks through to the fake site and inputs personal information, the scammer will use that information to file a tax return and claim a refund.
It is important to know that the Internal Revenue Service NEVER makes initial contact by email or social media. If you receive an email claiming to be from the IRS, do
not open any attachments or click through to any websites. Instead, forward the email to firstname.lastname@example.org and then delete the email.
If you receive a snail mail notice from the IRSstating that more than one return was filed for you, or referring to a tax year for which you have not yet filed a return or to an employer from whom you did not receive compensation, immediately contact the IRS representative listed on the notice.
If you think you are at immediate risk of identity theft (perhaps because of a lost wallet or purse), or if your identity has already been stolen and you are having difficulty in resolving related issues with the IRS, you can contact the IRS Identity Protection Specialized Unit at (800) 908-4490. And, as always, don’t hesitate to contact the attorneys at Wright Beamer for assistance.