Consumers: Your legal rights with tax-related identity theft
Tax-related identity theft occurs when someone uses stolen personal information to file a fraudulent tax return to claim a refund.
IRS statistics show a 148 percent increase in tax-related identity theft incidents between 2014 and 2015. The Federal Trade Commission (FTC) reports that for several years running, tax-related identity theft has been the most common form of identity theft.
Many people learn that they have been the victim of tax-related identity theft when they file their tax return and are told that a return has already been filed using their Social Security number, or when they receive an IRS notice indicating that a suspicious return has been filed in their name.
Avoid becoming a victim by protecting your personal information:
• Keep paper copies of your tax returns and financial records locked up.
• Monitor financial statements for unexpected transactions.
• Review credit reports at least once a year for unusual activity.
• Shred paper documents before disposal.
• Protect yourself from phishing and malware. People report receiving calls and e-mails from fraudsters claiming to be tax officials or employers, who instruct them to provide personal and financial information. Do not give your information out without verifying the identity of the party contacting you.
Communicate with the IRS: Victims should immediately contact the IRS and promptly respond to its notices and letters. Victims should also complete and submit to the IRS Form 14039, Identity Theft Affidavit.
The IRS's Identity Protection Specialized Unit (IRS-IPSU), which can be contacted at 1-800-908-4490, is available to assist taxpayers who have not yet received a resolution of their identity theft case. The IRS-IPSU can answer victims' questions about identity theft and help resolve tax account problems.
Because tax-related identity theft can impact many aspects of a person's financial life, it is important that victims notify a broad range of entities following discovery of an incident.
Minnesota Department of Revenue: The Minnesota Department of Revenue Criminal Investigation Division is responsible for investigating and prosecuting the filing of fraudulent state tax returns. It should be notified if a fraudulent federal or state tax return has been filed.
Social Security Administration: Victims of tax-related identity theft should notify the Social Security Administration's Office of Inspector General of the use of their SSN to file a fraudulent tax return. In some instances, it may issue victims a new SSN.
Credit Bureaus: Victims of identity theft may place a "fraud alert" in their file, or they may also "freeze" their credit reports, which blocks credit bureaus from sharing their information with potential creditors. This makes it difficult for identity thieves to open new accounts or take out loans in their name. The credit bureaus may be contacted as follows: Equifax, www.equifax.com, 1-800-525-6285; Experian, www.experian.com, 1-888-397-3742; and TransUnion, www.transunion.com ,1-800-680-7289.
State and Federal Law Enforcement: Identity theft is a crime. Victims of tax-related identity theft should report the incident to their county attorney, local law enforcement agency, and the Federal Bureau of Investigation.
Once a month, the Minnesota Attorney General's Office provides a consumer column as a public service announcement to help keep people informed about the latest consumer scams and other problems about which the office hears from the public.