Before reading this week’s blog please read the following out loud slowly.
THE IRS DOES NOT SEND EMAILS TO TAXPAYERS NOR WILL THEY CALL YOU AND HAVE YOU VERIFY YOUR IDENTITY OR ASK YOU TO PAY YOUR TAX OWED WITH ITunes Gift Cards.
Now that we have that issue under control, we can move on to the fastest growing IRS fraud. With the deadline looming for taxpayers, the crunch will be on for people scrambling to get their final documents together and submit their official tax return.
Imagine either of these scenarios.
You e-file your tax return only to receive a rejection notice from the IRS that states a return has already been filed with that social security number.
You mail your return, then several weeks later they respond saying that they have already received a tax return submitted by you.
How’s that for a situation that is sure to rock your world and if you have a refund – Good Luck! We are working with taxpayers who received that letter last May and they still do not have their 2015 refund.
The IRS has fought aggressively against refund fraud, which includes identity theft. In the calendar year 2015, through November, the IRS rejected or suspended the processing of 4.8 million suspicious returns. So far, the IRS stopped 1.4 million confirmed identity theft returns, totaling $8 billion. Additionally, through November 201, the IRS stopped $2.9 billion worth of refunds in other types of fraud. That’s a total of $10.9 billion in confirmed fraudulent refunds protected.
Unfortunately, in today’s world, all you really need are some social security numbers and the internet to start winning at the tax return identity theft game.
What should you do if someone stole your tax refund?
IRS Form 14039
When you discover another a tax return has been filed with your Social Security number, you’ll use IRS Form 14039 to alert the IRS. When you complete this form, you’ll indicate that someone has stolen your identity and it has affected your tax account since they have filed a return using your identifying information. You’ll also provide information about the tax year affected and the last return you filed prior to the identity theft.
Sending Form 14309
After you complete Form 14039, mail it to the IRS with a copy of your Social Security card and driver’s license. If you don’t have a driver’s license, you can substitute a U.S. Passport, military ID or government-issued identification card. Send it CERTIFIED MAIL RETURN RECEIPT REQUESTED.
If you received an IRS notice concerning the fraudulent return, include a copy of the notice. Mail the form and documents to the address shown in your notice.
If you did not receive an IRS notice, mail your documents to:
- Internal Revenue Service
- P.O. Box 9039
- Andover, MA 01810-0939
Request for Identity Verification from the IRS
When the IRS stops a suspicious tax return filing, they may send a letter called “Letter 5071C” asking that you verify your identity. It will include a couple ways to verify it: via a phone number or through the IRS’s Identity Verification Service, https://idverify.irs.gov.
This online service is the quickest method and will ask you multiple-choice questions to verify whether or not the tax return flagged for further identity verification was filed by you or someone else. The IRS only sends such notices by mail. The IRS will not request that you verify your identity by contacting you by phone or through email. If you receive such calls or emails, they are likely a scam.
If you can’t confirm your identity using the IRS’ online Identity Verification Service, you can call the IRS at the phone number included in the letter.
When confirming your identity, you will need:
- Your name, date of birth and contact information
- Social security number (SSN) or individual taxpayer identification number (ITIN)
- Your prior year tax return along with supporting documents such as W-2s, 1099s, and Schedules A and C if you filed them
When someone has enough of your personal information to file a fraudulent tax return, she can use your identity to commit other crimes. In addition to alerting the IRS, you should place a freeze on your credit report file with all three credit bureaus to prevent unauthorized accounts from being opened. The Federal Trade Commission also suggests filing an identity theft report with your local police department, and also with the FTC online.
If you have a question about this or any tax issue, then please give us a call.
Time to get your taxes completed,
Michael Tannery CPA CDFA® AIF® ● CEO
Be A Financial Olympian™