Fraudulent Tax Returns Due to Identity Theft

Florida has garnered the unfortunate status of being the state with the highest rate of identity theft in the nation, with the city of Miami leading the way. Although there are many companies offering identity theft protection, thieves still find a way to steal personal information. In the wake of the massive Target data breach that affected millions of shoppers this past holiday season, consumers everywhere should be cautious about where they input their personal information.

In 2012, the state of Florida had an identity theft rate of approximately 360 complaints per 100,000 residents, with Miami at top with 645 complaints per 100,000 residents. Since that year, Miami U.S. Attorney Wifredo Ferrer and his office prosecuted 270 defendants that involved around 76,700 identity thefts and $449 million in fraudulent tax refund claims.

What does this mean to you?

With tax season in motion, identity thieves can get your social security number and use it to file a fraudulent tax return to get your tax refund. In most cases, you really won’t find out that your identity has been stolen until after the second tax return is filed – either by you or the individual who has stolen your personal information. When the IRS receives a second return with the same social security number, that return will be rejected and a notice will be sent out explaining that a return has already been filed.

If this is the case, you must fill out Form 14039 (Identity Theft Affidavit) to alert the IRS that your identity has been stolen and a fraudulent return has been filed under your social security. When filling out Form 14039 you will also inform the IRS that this situation has affected your tax account, along with the information of the tax year affected and a copy of your last return that was filed before the identity theft.

Authorities, accountants and tax attorneys highly recommend that you file your taxes as early as possible so identity thieves don’t get to the IRS first. Never carry any documentation that may include your social security number and always be cautious of where you input your personal information.