Tax-related Identity Theft: Why You May Want to Consider Filing Your Tax Return Early

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The Internal Revenue Service (IRS) is now accepting 2018 tax returns, and, as in previous years, the agency recommends filing as early as possible to help prevent crooks from cashing in on your refund before you do.

You Could Beat Tax-related Identity Thieves to the Punch

Tax-related identity theft is when a criminal uses your stolen Social Security number to file a tax return claiming a fraudulent refund. The criminal’s goal is to collect your tax refund before either you or the IRS even realize what has happened.

You may not even find out about the fraud until your own tax return is rejected because someone already submitted a return using your Social Securing number. Alternatively, you may receive a letter from the IRS saying that they noticed a suspicious return.

This is where early filing comes into play.

The IRS accepts only one tax return per Social Security number, so if you file your authentic tax return before a criminal can file their fraudulent one, you may be able to beat an identity thief to the punch.

On the other hand, if a criminal succeeds in filing their fraudulent return first, it could take months to rectify false deductions, incorrectly reported income, or any other issues associated with your return.

In 2017, the IRS was able to detect and stop distribution of $6 billion in refunds that identity thieves attempted to fraudulently claim.

Don’t Rush to File an Incomplete Return

In your race to beat a potential tax-related identity thief, don’t file an incomplete return, which could cause other problems.

Some taxpayers assume they can file an incomplete tax return and resolve any issues later, but that isn’t a recommended strategy. You could be charged penalties and interest for any delays in submitting your fully completed return. In addition, multiple errors on a return could attract the attention of the IRS and trigger a second look or even an audit.

Once you have collected the documents required for the complete filing of your tax return (W-2s, 1099s, mortgage interest statements, and so on), it can be wise to move the process along to try to help stay ahead of identity thieves.

What To Do If You Are a Victim of Tax-related Identity Theft

If you suspect that you are a victim of tax-related identity theft, the IRS recommends the following steps:

  • Respond immediately to any IRS notice by calling the phone number provided.
  • File an Identity Theft Affidavit (IRS Form 14039) electronically at, if your e-filed return gets rejected because of an existing filing under your Social Security number, or if the IRS instructs you to do so.
  • Continue to pay your taxes and file your tax return, even if you have to submit your tax return by paper.

If you are contacted by the IRS, be aware of IRS impersonators. The IRS warns taxpayers that it does not communicate electronically to request personal or financial information, including by email, text messages, or social media channels. If you receive suspicious email or online communication from someone claiming to be a representative from the IRS, report it to the Treasury Inspector General for Tax Administration.

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