Each year, millions of Americans rely on their tax return to make necessary purchases or catch up on accumulating bills. These checks, which represent hard-earned money the IRS has held hostage throughout the preceding year, are especially helpful to the countless families struggling to make ends meet during Barack Obama’s assault on the American economy.
In addition to their intended recipient, returns are also especially attractive to identity thieves.
According to a recent CNBC report, the Federal Trade Commission indicates that the instances of ID theft related to tax returns almost tripled between 2010 and 2013. As of last year, nearly half of all complaints the commission received regarding identity theft were related to tax returns.
Experts predict a similar increase this year. According to Identity Theft 911 Chairman Adam Levin, this type of fraud is “a lucrative crime and relatively easy to commit.”
He explained that criminals need only “a Social Security number and some counterfeit documents, describing it as “much easier than selling drugs or stealing cars and much less risky for the bad guys.”
A few simple steps, however, can reduce a taxpayer’s risk of becoming a victim.
Tax filers can get ahead of the curve by submitting paperwork as early as possible. Those filing paper returns should send them to the IRS via the Post Office, while electronic filers should ensure they are operating from a secure network.
Protecting one’s personal data is of paramount importance, too.
“The Social Security number is the Holy Grail,” explained Identity Theft Resource Center President Eva Velasquez. “Once you have enough information to file a phony tax return, you have enough information to open new lines of credit, commit medical identity theft and take over financial accounts.”
Retail giant Target’s recent identity breach illustrated how easy it is for Americans to fall victim to identity thieves. Experts recommend keeping a close eye on all financial documents for signs of fraud or inconsistencies.
The IRS, with 3,000 staff members directly responsible for tracking down cases of identity theft, investigated nearly 1,500 cases last year. The number of indictments stemming from those investigations doubled compared to the previous year.
–B. Christopher Agee
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Photo Credit: 401K 2012 (Creative Commons)