By Abby Mackey, Tax supervisor, LGT
Have you or someone you know experienced tax identity theft? For the 2014 tax year, there was a staggering number of tax identity theft cases filed with the Federal Trade Commission — more than 330,000. Sixty-three percent of CPAs who answered the 2015 tax software survey conducted by The Tax Adviser and Journal of Accountancy said at least one of their clients was a victim of tax identity theft during the 2015 filing season.
Tax identity theft occurs when someone uses your stolen Social Security number to file a fraudulent tax return and claim a refund. Most victims are unaware of this issue until they try to file their own return and receive a notice that a return with that Social Security number has already been filed.
According to the IRS, if your Social Security number is compromised and you know or suspect you are a victim of tax-related identity theft, take the following steps.
The IRS has recently announced several new initiatives to work with tax industry professionals to improve information sharing and increase the detection and prevention of refund fraud. The initiatives include taxpayer authentication, identifying fraud, assessing information, cybersecurity framework and increasing taxpayer awareness and communication. These initiatives, along with the efforts of the Taxpayer Protection Program and Taxpayer Advocate Services, should continue to combat identity theft and help field victims’ concerns.
As a reminder, the IRS does not initiate contact with taxpayers by email to request personal or financial information. This includes any type of electronic communication, such as text messages and social media channels.
The services of a legal or tax advisor should be sought before implementing any ideas contained in this blog. To reach a financial advisor at Lane Gorman Trubit, PLLC, call (214) 871-7500 or email email@example.com.