Posting by Billy Thomas

Unfortunately, it is not uncommon to read a headline on a routine basis highlighting a private data hack (see OPM, Target, Home Depot, IRS, etc.) impacting thousands, if not millions of individuals, with each instance. More and more personal and financial data is stored electronically and this identity theft epidemic is only growing. Perhaps this is an unintended consequence to the speed and accessibility of your digital record-keeping. Although words can barely express the sense of loss when your personal and financial information is compromised or stolen. It is a frustrating experience leaving victims feeling helpless and vulnerable.

A data breach, or cybersecurity incident, as described by the Office of Personnel Management (OPM), is a different type of crime compared to tax-related identity theft. The OPM cybersecurity incident resulted in the theft of sensitive, personal information such as names, addresses, birthdates, and Social Security numbers. Even though this data was stolen, OPM has stated “there is no information to suggest misuse of the information that was stolen from OPM’s systems.” Tax-related identity theft occurs when someone ‘uses’ your stolen Social Security number to file a false return claiming a fraudulent refund.

The data breach and tax-related identity theft problems are mutually exclusive. For more information on next steps for victims of the OPM data breach, please click here.

We have covered taxpayer identity theft in previous blog entries: Protecting yourself from tax-related identity theft. The IRS has dedicated many resources to addressing this type of fraud and here are some of the warning signs you should know:

  • You receive an IRS notice indicating more than one tax return was filed under your SSN, you owe additional tax, your refund has been off-set, or the IRS indicates you received wages from an unknown employer to you.

If there can be a silver-lining, it is this form of tax-related identity theft is often isolated to tax matters alone. Nonetheless, the IRS recommends the following actions to ensure your other financial information has not been compromised further:

To protect your personal information, the IRS recommends the following to reduce your risk of identity theft beyond your tax matters.

  • Don’t routinely carry your Social Security card or any document with your SSN on it.
  • Don’t give a business your SSN just because they ask – only when absolutely necessary.
  • Protect your financial information at home and on your computer.
  • Check your credit report annually.
  • Check your Social Security Administration earnings statement annually.
  • Protect your personal computers by using firewalls, anti-spam/virus software, update security patches, and change passwords for internet accounts.
  • Don’t give personal information over the phone, through the mail or the Internet unless you have either initiated the contact or are sure you know who is asking.

It is also important to know that the IRS will never initiate contact electronically to request personal or financial information from you. You can check out all the tax-related identity theft information posted by the IRS, here.

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