Identity theft often begins when someone’s personal information is lost or stolen. Identity thieves can then misuse a taxpayer’s identity.
I am currently dealing with an identity theft case, in which my client was unaware that his identity had been stolen. He was working in New Jersey and when he was laid off, he applied for unemployment benefits. To his astonishment, he was denied and told that, according to Social Security Administration office records, he is working and is not eligible for unemployment benefits. Meanwhile, he received some notices from the Internal Revenue Service reporting his tax liability and approached our organization for help.
In verification of his case, it came to light that his identity theft occurred a few years ago and using his identity, someone else applied for an SSN and used it to get a job. The client is in New Jersey, but according to the report to the IRS, he works in four or five US states, including New Jersey, and is liable for the tax deficiency for failing to report his out-of-state income. His individual tax refund claims for the last five years were put on hold and the innocent taxpayer couldn’t bring himself to contact the IRS to get a refund from him.
The fastest growing crime is identity theft, which is occurring across the country and is the biggest challenge facing the IRS. More cases are being reported during tax filing season where identity thieves get the information and themselves claim to be the real person and file tax returns and try to get the refunds at the start of tax filing season and the innocent taxpayer does not know. that your tax return using the social security number has already been filed.
Misuse of Social Security Number, financial information to obtain a tax refund or social security or other benefits are crimes that are on the rise. Now we see more SSN use from young children or older taxpayers who don’t file their tax returns.
Some fake tax preparer gives SSN information and other personal information to criminal gangs. Some cases of obtaining information from health care providers and insurance agents have arisen.
In Georgia, an elderly woman in nursing home care had her identity stolen by a nursing home employee, resulting in reduced Social Security benefits, food stamps, and Medicare benefits. The old woman had to suffer emotional pain from being in a nursing home and lost the trust of the caregiver, in addition to the pain of losing her personal information.
People age 65 and older typically do not file tax returns since their income for the tax year is less than $11,500 for singles and $22,400 for married. Depending on marital status, age and income, etc., most seniors do not file taxes. Criminal gangs in possession of your financial information and SSN file tax returns on your behalf and demand large refunds, while the innocent older taxpayer is unaware of such tax returns. Most of the cases are increasing in the state of Florida, especially in South Florida.
Every citizen, even if they do not have to file a declaration, must present the Federal Income Tax at least to obtain the refund of the Tax withheld. They can go to Tax Counseling for Seniors or Income Tax Assistance Volunteers locations that offer free tax help. They are IRS-certified volunteers who provide tax advice associated with nonprofit organizations that receive IRS grants.
Another form of identity theft is to obtain the information from the Death Master file. The IRS is aware of the same. Some recommendations are being considered to limit access to and publication of the death master file after three years, withdraw the SSN after three years. Death master file information can be released to institutions/companies that have legitimate needs, block the file once final declarations are being considered.
In one case involving a wealthy married couple, the husband died. The deceased husband’s information was used to file the tax return along with another male person. The IRS was suspicious and withheld the refund. The deceased’s wife without knowing about it then filed her joint return and wanted to pay the amount owed to the IRS. Her electronically filed return was rejected by the IRS. She was concerned that if the returns were not filed on time, she would be subject to fines and late filing fees.
The Internal Revenue Service has made identity theft their top priority, and some 3,000 employees are working to tackle the biggest challenge.
Tips to protect yourself from being a victim of identity theft
Do not carry your Social Security Card or any document that includes information about your SSN.
Ask companies that ask for SSNs if they really need your personal information.
Monitor your bank accounts daily if possible.
Report lost or stolen health insurance ID cards.
Review your health insurance explanation of benefits each month.
Check card readers for skimming devices when buying gas at the pump
Don’t add people you don’t know on Facebook
Check your Facebook privacy settings
Put minimal personal information on your resume when looking for a job.
Opt out of receiving pre-screened credit card offers.
Review your free credit reports from each credit reporting agency every 12 months. Monitoring your credit report is the best way to detect signs of identity theft, such as errors, suspicious activity, and accounts or addresses you don’t recognize.
Secure your personal information.
Do not use the same password for all accounts.
If you are using computers, use firewalls and anti-spam/virus software and change Internet account passwords frequently.
Avoid giving out your personal information over the phone, mail, or the Internet unless you initiate the contact.
Try to file tax returns early.
Go to the post office and mail your tax returns instead of putting them in the mailbox.
The IRS does not email or call you. If someone is calling you and complaining to the IRS, hang up the phone.
Do not put home address on websites.
Do not redirect your direct deposit.
Open your emails instead of saving them fearing they are from the IRS.
Things to do if you are a victim of identity theft.
If you receive a notice from the IRS mentioning receipt of more than one tax return, reply to the number listed on the notice.
If your refund has been offset by a tax return from prior years that you have not yet filed, contact the IRS.
Based on the income reported to the IRS, your federal benefits have been reduced or stopped.
If you believe you are a victim of identity theft, contact the IRS Identity Protection Unit at 800-908-4490 extension 245 immediately so the IRS can take steps to protect your tax account and match your SSN .
Also, complete the IRS Identity Theft Affidavit and submit it to the IRS. The IRS will investigate and try to resolve the issue within six months.
In addition, it is recommended:
File a report with the local police.
Report incidents to the FTC’s identity theft hotline at 877-438-4338.
Report incidents to the OIG hotline @18002690271
Contact the credit bureaus fraud department unit.
Close any account that has been tampered with or opened fraudulently
Block electronic access to the account by visiting ssa.org
Report identity theft to the Internet Crime Reporting Center.
http://www.ic3.gov/
Advice
SSN change is not recommended, otherwise it is a fresh start which is not an easy way. The SSN is linked to several agencies and it is not easy to approach each agency and report the change of SSN. Private companies have an old SSN and you must explain the reason for the SSN change. Credit reporting agencies must be informed in the event of a change in SSN. Knowledge-based questions can be used to reduce fraud.
I volunteer with the Northeast New Jersey Legal Service assisting in our low income tax clinic.
T.Rinu Cherian
