Your identity and money can be stolen in a tax-related scam via email (“phishing”), fax, phone, or letters. Some common examples of identity theft scams are:
If you receive a tax-related phishing email, do not click on the links or open any attachments. Forward the email email@example.com or call the Treasury Inspector General for Tax Administration at 800-366-4484.
An identity thief might use your Social Security Number to fraudulently file a tax return and claim a refund. You could be completely unaware that your identity has been stolen until your return is rejected for e-filing or you get an IRS notice or letter.
Your electronically-filed return is rejected because the Social Security Number belonging to you, your spouse, or a dependent has already been used on a tax return.
You receive an IRS notice or letter stating that:
You should respond immediately to the name and phone number printed on the IRS notice or letter. You will be asked to complete Form 14039, Identity Theft Affidavit, and provide identifying information.
If you believe there is a risk of identity theft due to lost or stolen personal information, contact the IDTVA immediately so the agency can take action to secure your tax account.
Form 14039 has two purposes.
You must provide details of the actual or potential identity theft situation, tax years impacted (if known), address and other contact information, and a photocopy of valid government-issued identification.
An Identity Protection PIN (IP PIN) is a six-digit number assigned to eligible taxpayers to prevent the misuse of their Social Security Number (SSN) or individual taxpayer identification number (ITIN). Anyone who has an SSN or ITIN and is able to verify their identity is eligible for an IP PIN.
If you filed Form 14039, a CP01A Notice will be mailed to you each year with your new IP PIN. An IP PIN is valid for one calendar year. Anyone may request an IP PIN by passing an identity verification process. Go to www.irs.gov/IPPIN to:
There is currently no opt-out option once you are enrolled in the program, but the IRS is working on one.
If the IRS assigned you an IP PIN, you must use it to confirm your identity on any return filed during the calendar year. A new IP PIN is generated each year. Never share your IP PIN with anyone except your trusted tax provider.
If an IP PIN is missing or incorrect on an e-filed return, there turn will be rejected and the correct IP PIN needs to be entered before e-filing again. If an IP PIN is missing or incorrect on a paper return, your return will take longer to process while the IRS verifies your identity.
The IRS has been known to mail an IP PIN letter to a taxpayer who was previously unaware of a potential tax-related identity theft problem. If you receive an unexpected IPPIN letter, you can call the IDTVA phone number (800-908-4490) to verify that the IP PIN letter is legitimate.
You may be at increased risk for tax-related identity theft for various reasons.
Victims of credit card fraud and identity theft outside the tax system should report the crime to the appropriate authorities, including the police, credit card issuers, and fraud units of credit reporting bureaus.
DISCLAIMER: This article contains general information for U.S. taxpayers and should not be relied upon as the only source of authority. Seek out professional tax, legal, or financial advice from CryptoTaxAudit or from other reputable companies.