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Identifying Tax-Related Identity Theft

Identity theft has become a very common crime and can impact individuals in many ways.

Apart from an identity thief stealing your identity and obtaining credit cards or bank account information, an identity thief may use your personal information and steal your identity for tax purposes and tax-related theft.  Although the Internal Revenue Service and state taxing authorities work hard to prevent identity theft, you can assist your assist by being aware of common signs of tax-related identity theft.  The article below has been prepared by a tax attorney to provide information and what you may consider as warnings or red flags that your identity has been compromised, and the thief using your identity for a tax related purpose.

  • When you go to file your tax return electronically, the return is rejected. The message may state that a return with a duplicate social security number or tax identification number has already been filed.  This may mean that someone has used your social security number to file a tax return.  You may want to check the social security number you used, but if the social security number you are using is correct, your identity may have been stolen.  The Internal Revenue Service has an identity theft affidavit (Form 14039) that can be filed with the IRS.  Please see the instructions for Form 14039, and any related form.
  • The Internal Revenue Service may forward you a letter requesting that you verify whether you have filed a return with your name and social security number. When the IRS receives a suspicious return, the IRS may hold the return and mail a letter to the taxpayer to verify certain information.  If you did not file the return, it is likely someone is attempting to steal your identity for a tax-related purpose.
  • If you receive a W-2 or a 1099 (or other items) reported to you for the income you did not receive or from third parties you did not work for, or perform services for, someone may have compromised your identity and reported income under your social security number.
  • You receive a check from the United States Department of Treasury as a refund that you did not claim. If the refund is incorrect, you likely do not want to deposit the check and should contact the IRS or a tax attorney.
  • You receive a wage and income transcript, account transcript, tax return transcript, or other tax return transcript from the Internal Revenue Service that you did not request. Identity theft may be attempting to test or receive information via transcript.

The Internal Revenue Service has information available regarding identity theft, including Publication 4524.

The article above has been prepared for informational purposes by John McGuire, a tax attorney at The McGuire Law Firm.  Please consult with your tax attorney, tax advisor, or other parties regarding our specific questions. Call (720) 833-7705

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