3 Ways to Protect Yourself from Tax Fraud
May 4 2016
Tax fraud isn’t done (solely) by dumpster diving anymore. Data breaches, phishing email scams, and more abound, like the ploy in which thieves pose as tax preparers and the IRS via fake email addresses. This means you need to do more to stay safe from theft. The IRS is doing secret analytic stuff (undisclosed, in fear of educating the bad guys), but you have do your part, too. Being clumsy with providing your name, date of birth, and social security number equals arming a perpetrator with the ability to steal your identity, and therefore your money. Below are 3 ways to keep your assets safe.
File Early and Electronically
This is probably the most simple but most important way to safeguard your tax return. Paper documents can be snatched and tampered with, so work directly with the IRS or a trusted third party to file online. The earlier you file, the more likely you’ll keep thieves at bay. If another return is filed, the IRS can flag this as possible fraud. Many victims of tax fraud try to file right before the deadline, and their refund is long gone. Save the headache and file as soon as you receive your documents.
Keep Your Card and Documents Safe at Home, Or Shred Them
Like your birth certificate or diploma, your social security card is a flimsy yet valuable piece of paper that’s not easy to replace. Losing your Social Security card can put you in a big pickle – someone could easily use that information against you, including to reap the monetary benefits your tax refund. Lock it away and only carry it around if you have a specific reason to, then lock it up again safely. As tax refund thieves often use old tax documents, make sure these are not available in your garbage bin or on an open-access location online. If you need to throw them away, make friends with a shredder.
Be Wary of Providing Your SSN – Only Make Secure Online Purchases
Remember the Target breach? Let’s not go there. Look for the secure transaction label – otherwise, skip it. Stay in the know about security breaches at retailers you frequent, regularly change your passwords on the secure online shopping accounts you do engage in, and remove personal information from social media sites that can be strung together with your stolen credit card or SSN information.
Go With a Trusted Tax Preparer
A seasoned, informed tax preparer will not only help you get the biggest return, but will keep your information secure. Thieves posing as tax preparers to this length is rare, but tax preparers being a little haphazard with your private information is not. Vet them appropriately and pay attention to their methods of operation.
These three tactics are just the tip of the iceberg of security. Other must-dos include regularly checking your credit report and flagging suspicious activity, knowing how the IRS operates (they’ll never call or email you, for instance), and making sure your online documents are password protected. No need to be fearful of tax refund theft – simply be proactive and aware.
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