Tax Identity Theft is a growing concern today and with cybercriminals becoming increasingly sophisticated in their methods, it has become important that everyone remain informed on the latest breaches and what they can do to protect themselves from a hack.
As Tax Identity Theft Awareness Week approaches on January 21, we’re taking a closer look at the risks and proactive steps you can take to protect your financial well-being.
What is Tax Identity Theft?
Tax Identity Theft occurs when someone uses your stolen Social Security number to file a fraudulent tax return and claim a refund. Victims often remain unaware until they attempt to file their legitimate tax return, only to discover that one has already been processed under their name.
The Impact on Victims
The consequences of tax identity theft are far-reaching. Beyond the immediate financial loss resulting from fraudulent refunds, victims may face delays in receiving their legitimate tax refunds. Additionally, untangling the mess left by identity thieves can be a time-consuming and stressful ordeal.
How to Protect Yourself
- File Early: Beat identity thieves to the punch by filing your tax return as early as possible. The sooner you file, the less time criminals can submit a fraudulent return using your information.
- Use a Secure Connection: When filing online, make sure to use a secure and encrypted internet connection. Avoid public Wi-Fi networks, as they may be vulnerable to hackers.
- Protect Personal Information: Safeguard your Social Security number, financial records, and other sensitive information. Be cautious about sharing such details, even with trusted entities, and regularly monitor your accounts for any suspicious activity.
- Monitor Your Credit Report: Regularly review your credit report for unauthorized activity. Promptly address any discrepancies to mitigate potential damage.
- Educate Yourself: Stay informed about the latest tax-related scams and phishing tactics. The more aware you are, the better equipped you’ll be to recognize and avoid potential threats.
Reporting Tax Identity Theft
If you suspect you’re a victim of tax identity theft, act promptly. Contact the IRS Identity Protection Specialized Unit and file a complaint with the Federal Trade Commission (FTC). Reporting the incident promptly can help mitigate the impact and aid in the investigation.
Let Tax Identity Theft Awareness Week serve as a timely reminder to prioritize the security of your personal information. By staying vigilant, adopting safe practices, and acting swiftly if you suspect foul play, you can fortify your defenses against this pervasive financial threat. Protect yourself and your finances—because an ounce of prevention is worth a pound of cure.