Identity thieves try to file fraudulent tax returns to claim refunds. There are steps taxpayers can take to protect themselves.
Tax returns identified as fraudulent by these IRS filters are held during processing until the IRS can verify the taxpayer's identity.
"They're trying to crack down ... to make sure you're [the one] actually filing," said Dan Herron, a certified public accountant and certified financial planner based in San Luis Obispo, California.One of Herron's new clients had been filing a paper tax return every year with a different accountant but filed an electronic return in 2023. The client received an IRS notice in the mail saying that the return had been flagged for fraud.
"It's not a perfect system, but it's going in the right direction," Herron, founder of Elemental Wealth Advisors, said of the IRS systems.Taxpayers may not know they're the victim of tax-related identity theft until they try to file a return online and learn that a return was already filed using their Social Security number.
A tax return filed by a scammer without the associated IP PIN would not be processed, Olson said. She recommends taxpayers who want an IP PIN request one in the latter part of the calendar year, ahead of the tax season, and that they keep it handy.Taxpayers can also reduce their risk by trying to file a return early in the tax season, experts said.
The IRS also never initiates contact with taxpayers by e-mail, text or social media to request personal or financial information, and never calls to threaten lawsuits or arrest, the agency said.victims of tax-related identity theft take a few important steps:, Identity Theft Affidavit, if your e-file return is rejected because of a duplicate filing using your Social Security number. Continue to pay your taxes and file your tax return, even if it must be by paper.
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