3 Tips for Reducing Your Tax Identity Theft Risk

Tue, Jan 24, 2023
By: Steve Clopton
3 Tips for Reducing Your Tax Identity Theft Risk

When someone steals your personal information and Social Security number, he or she can file a tax return and fraudulently claim a refund. If you are a victim of tax identity theft, you may not be able to file an electronic tax return. The IRS recommends filing a paper return if you cannot file an electronic return. The IRS should notify you if someone filed a tax return in your name.

Additional ways to determine if you are a victim of tax identity theft include:

  • E-filing states that you are filing under a duplicate Social Security number.
  • The IRS sends you a tax transcript that you did not request.
  • The IRS sends you a notice that you created an account that you did not create.
  • You receive notice that your account was disabled or accessed when you didn’t access the account.
  • You receive a notice that you owe additional tax or have collections actions against you.
  • You receive a notice that states the IRS assigned you an EIN.
  • Your IRS records show that you received wages or income from an employer you never worked for.

1. Tax Identity Theft: Protecting Your Information Online

When you use an online tax preparation program, be sure to use multi-factor authentication. This method of logging in requires you to use at least two credentials to log in – usually a password and another method, such as a text, email or authenticator. Some may offer a fingerprint scan.

2. Never Give Your Personal Information to Someone Over the Phone

If someone calls and states that he or she is from the Internal Revenue Service, do not give any of your personal information. The IRS doesn’t call – it sends you a letter. If you are unsure, hang up and call the IRS back at (800) 829-1040. Many scammers will call you or even send you a text messages regarding your account at the IRS. Delete these messages immediately, and do not click on any link within the text message.

3. Tax Season Shredding

Every tax season, you should go through your old records and pull out any tax documents you no longer need to keep. Place them in a locked space to get them ready for shredding. You should not use a home shredder to shred tax documents, as they usually don’t create small enough pieces. An identity thief with a lot of patience could recreate the documents.

Generally, you keep tax returns for seven years. Depending on the supporting document, you might keep it for a year or two to four years. Bank statements, receipts, and paystubs can be shredded after a year. W2s and other tax documents can be shredded after two to four years, depending on the document.

Contact Gilmore for Tax Season Shredding

Using a professional shredding company ensures that an identity thief cannot reconstruct your documents. The shredder in our trucks cut the paper into very small bits. The paper is then baled – along with others’ shredded documents – and forwarded to a recycler that is held to the same high standards we are.

Contact Gilmore to schedule an appointment for the shredding truck to come to your business and to learn more about our services, including locked shred boxes to store your documents throughout the month or year.