E-File Tax Identity Theft Scam
Impacting Many Taxpayers
According to the American Medical Association, the identity theft scam that emerged during 2014’s filing season (2013 returns) continues and has shown an increase in the number of physicians that have notified the association that they have been victims of this identity theft scam when filing their 2014 tax returns (2015 filing season). Unfortunately, victims are unaware of the identity theft until they attempt to file their tax returns electronically (which is now mandated by the IRS). The IRS is sending 5071C letters to suspected fraud victims with instructions to contact the its identity theft website guide or call the IRS at (800) 830-5084. If you are NOT affected, the IRS does not recommend filing paper returns. In fact, they suggest that it would be best to file electronically as early as possible so as to prevent the bad guys from filing first.
If you are a victim of the scam, the following are some of the suggestions of things to do:
- IRS - If you are a victim of this scam, you'll note the IRS 5071C letter provides instructions about contacting the IRS through its identity theft website guide or by phone at (800) 830-5084 to let officials know you did not file the return referenced in their letter. If you are a victim, you will not be able to electronically file your return this year since a return with your Social Security number has already been filed. You'll need to file a paper return and attach an IRS 14039 Identity Theft Affidavit to describe what happened. Attach copies of any notices you received from the IRS, like the 5071C letter. Be sure to let your tax preparer know if this happens to you. Verify with the IRS and your tax preparer where to mail your paper tax return, based on the type of return you are filing and your geographic area. Work with your tax preparer to file paper returns with Form 14039 (identity theft affidavit) and Form 8948 (e-file opt-out). You will also need an affidavit and a government issued ID (driver's license or passport). The process of an individual filing the paper return with the Form 14039 notifies IRS that the paper return is the correct filing. IRS then removes the fraudulent filing from the taxpayers account, posts the correct tax return and if due a refund, issues the refund. The major way it impacts someone due a refund is that the process takes longer.
- Police report - Consider filing a report with the local police where you reside. Bring all documentation available, including any state and federal complaints you filed. This will likely be necessary if there is financial account fraud as a result of the identity theft. However, if the only fraud is tax fraud, the police report will be necessary only if requested by the IRS.
- Social Security - Call the Social Security Administration's fraud hotline at (800) 269-0271 to report fraudulent use of your Social Security number. In case your number is being used for fraudulent employment, you can also request your Personal Earnings and Benefit Estimates Statement on their website or call (800) 772-1213. Check it for accuracy.
- Contact a fraud unit at one of three credit bureaus:
- Office of the Arizona Attorney General - taxpayers affected can find additional guidance through the office of the Attorney General. Their website lists resources and steps for identity theft victims.
- If you have not received a notification from the IRS but believe your personal information may have been used fraudulently or are concerned about whether you may have been victimized, call the IRS Identity Protection Specialized Unit at (800) 908-4490. Find more information from the IRS, including forms, at the IRS website.
Taxpayers may also consider enrolling in a 90-day credit fraud alert at Experian. This could potentially slow or halt further attempted identity theft activities. This is only suggested out of an abundance of caution - we have no reason to believe that every taxpayer is at risk. We understand that Experian will feed this information and fraud alerts to the other two major credit reporting agencies. If you remain concerned, it is suggested that you go back onto Experian after 89 days to initiate subsequent 90-day credit fraud alerts.
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