In an effort to stay one step ahead of scammers and identity theft, the Internal Revenue Service is introducing new identity verification precautions before processing tax returns and issuing refunds in situations where the IRS suspects that identity theft may exist. This is part of an aggressive strategy to prevent and detect identity theft in response to the Federal Trade Commission determining that fraudulent government documents like tax returns are the most common form of identity theft.
If you receive a 5071C letter from the IRS requesting that you verify your identity, do not ignore it; lack of response could delay your return processing and ultimately your receipt of any tax refund due to you. There are a couple of ways to respond to the IRS request. First, you can utilize the identity verification service website, idverify.irs.gov, which asks a series of questions that only the real taxpayer can answer. Alternatively, taxpayers can call the toll-free number provided in the letter. You will need to provide your name, social security number or individual taxpayer identification number, date of birth, contact information, and some information about your prior year (2013) and current year (2014) tax returns, including your adjusted gross income and deductions taken. To expedite the process, make sure to have this information on hand before going online or placing a call to the IRS. Once you have verified your identity, you will be asked to either confirm or deny that you filed the tax return in question. It will then take approximately six weeks for the IRS to process the return.
There are steps you can take to minimize the likelihood of becoming a victim of identity theft. The IRS suggests keeping your social security card and any documents that include your SSN at home in a secured area. You should never share your SSN unless absolutely necessary. Similarly, sharing any personal information over the phone, mail or internet should be handled carefully. On the internet, for instance, it is a good idea to verify a secure connection to the website (the URL will likely read “https” rather than “http”) and also ensure a secure connection to the internet with appropriate firewalls and anti-virus software active. It is also advisable to check your credit reports at least once per year for any new accounts or suspicious activity. Also, remember that the IRS only contacts taxpayers through USPS mail; they will never contact you over the phone or email to request personal information. If you do receive an email claiming to be from the IRS, you are strongly encouraged to forward it to email@example.com so the identity theft team at the IRS can investigate further.
If you are a victim of identity theft, there are several steps you should take to remedy the situation. First, you need to report the incident to the Federal Trade Commission through the website, www.consumer.gov/idtheft, or by using the FTC Identity Theft hotline at 1-877-438-4338. In addition, you should file a police report, contact th