Identity Thieves Target IRS Refunds

Identity thieves are increasingly stepping up their criminal endeavors with technology and online services meant to be convenient for consumers. The Internal Revenue Service is cracking down on the growing problem of identity thieves using consumer information to get tens of thousands of dollars in fraudulent tax refunds.

If you have filed your taxes but received a notice from the IRS stating you already filed a tax return or you received W-2 or 1099 forms from an employer you do not know, you may be a victim of identity theft.

The Internal Revenue Service says it has seen a “huge spike” in cases of identity theft. IRS Special Agent Brian Watson says people are stealing social security numbers and other identifiers from people, filing returns and claiming the refund. Watson says most people don’t find out they’ve been a victim of fraud until they go to file their own return.

How IRS Identity Theft Occurs

Some consumers may lose their wallet or purses which can make them subject to identity theft but more often, consumers fall victim to phishing schemes. Unsuspecting consumers are targeted through phishing schemes and end up turning over vital data such as their name, address, date of birth and Social Security number.

Once this information is obtained by the criminal, the data can then be used to create phony tax returns. What’s worse, the victim is unaware until they get ready to file a tax return. And, it can take several months for the Internal Revenue Service to resolve identity theft issues.

How to Avoid Being a Victim

The IRS suggests consumers not give out their social security number unless absolutely necessary. IRS Special Agent Watson says the IRS will never send an email to get in touch and if you get an email, it is a SCAM. Watson suggests you not open the email at all. The IRS will always get in touch with you through United States Postal Service.

The IRS would never simply contact you through the email requesting your personal information, especially your Social Security Number. It’s pretty safe to assume they already have your personal information.

Never click on an email link about your taxes. As mentioned, the IRS never emails taxpayers. Scammers may pretend to be well-known tax preparation companies like H&R Block Inc and Intuit, which publishes TurboTax. If you get an email about your taxes that tells you to visit a website and update information or check your return, just open your browser and directly type in the web address.

Preventative Steps by the IRS

In February 2013, the IRS announced the results of a massive national sweep targeting identity theft suspects in 32 states and Puerto Rico, which involved 215 cities and surrounding areas. The identity theft suspects numbered 389 and led to 734 enforcement actions in January, including indictments, informations, complaints and arrests.

The number of IRS ID theft investigations tripled in 2012 and is focused on high-risk cities such as Miami, New York, Atlanta, San Francisco, Chicago and Los Angeles.

In 2012, the IRS says its investigations and in-house filtering systems prevented $20 billion in would-be fraudulent refunds, up from $14 billion the year before. Thieves still get away with stealing numerous tax refunds, although the IRS could not provide exact loss figures.

If you suspect that your taxes have been affected by identity theft immediately contact the Internal Revenue Service at and click “identity theft” on the homepage. They have forms you can file such as Form 14039 Identity Theft Affidavit. You can also apply for an identity protection PINs which can be used to verify you are the rightful owner of a Social Security number and is used only to file a tax return.

Here is a short video by the IRS on Identity Theft:


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