Will you be a victim of tax return fraud?

For tax scammers, tax season equals ill-gotten profits. Tax refund fraud victims usually first learn of the crime after having their returns rejected because scammers beat them to it. Even those who are not required to file a return can be victims of refund fraud, as are those who are not due a refund. One of the main reasons for tax fraud is that it takes so little information to file a false return – just your name, date of birth and Social Security number, all of which were probably stolen during the 2017 Equifax breach or numerous breaches since then.
Did you know the best defense the IRS recommends is to file your taxes as soon as possible? You should receive all of your supporting tax information by the middle of February, so get to it!
New this year:

  • The IRS will begin accepting tax returns on Feb. 12! Although taxes aren’t due until April 15, you should file your taxes as soon as possible due to income tax fraud.
  • Michigan residents are eligible for the IRS Identity Protection Personal Identification Number (IP PIN) Opt-In Program. The IP PIN is a six-digit number assigned to eligible taxpayers to help prevent the misuse of their Social Security number on fraudulent federal income tax returns. An IP PIN helps the IRS verify a taxpayer’s identity and accept their electronic or paper tax return. When you have an IP PIN, it prevents someone else from filing a tax return with your SSN.
  • Credit freezes are free. A credit freeze allows you to restrict access to your credit report and protects your personal information. Preventing creditors from viewing your information helps stop new lines of credit from being opened in your name.

Before you file
Keep your eye on your information!

  • Don’t carry your Social Security card or other information containing your Social Security number (SSN) with you.
  • Don’t give businesses your SSN just because they ask for it. Give it only when required.
  • Take a look at your Social Security earnings statement each year. If that number is off, you need to investigate.
  • Two of the most common ways to steal sensitive data are dumpster diving and mail theft. Investing in a crosscut shredder and a lockable mailbox will help eliminate those risks.
  • To help protect the personal information on your computer, use firewalls and anti-virus software, update your computer with security patches, and change your passwords regularly.

Do not email your W-2 or any other confidential information. Email is the equivalent of a postcard; everyone can see it. If you must send your SSN over email, encrypt it with a product like 7-Zip, or use the encryption in MS Word, Excel or Adobe PDFs. You can also download your W-2 onto an encrypted thumb drive or to the H: network share.
Next week, the second part of this three-part series, will include tips on how to avoid fraud when you are ready to file. If you have any questions, please contact LCC Director of Information Security, Paul H. Schwartz, at schwarp1@lcc.edu.