Lower the Potential for Identity Theft With These 8 Strategies

Reduce the Risk of Identity Theft With These Eight Strategies

Tax fraud

Tax fraud

Believe it or not, identity theft is a problem with tax filing. Many people are filing taxes under false Social Security numbers, and the IRS is getting savvier about this common practice. They are throwing down the “gauntlet,” so to speak, on people who do engage in fraudulent activity. This season, the IRS is exposing the latest tax scams. Identity theft is one of them. If you want to do your part in reducing identity theft, here are eight strategies to help you prevent it from occurring in your life:

Identity Protection PIN

Identity Protection PIN

1. Use Identity Protection PINs

Using the Identity Protection PIN (IP PINs) can help to prevent future identity theft as it relates to tax filing. The IP PIN is a unique, six-digit number that is assigned each year to people who have been victims of identity theft. The PIN will help people who are filing federal tax returns avoid delays. This new program has been offered to 1.7 million taxpayers who would like the opportunity to opt into the IP PIN program. Nearly 1.5 million IP PINs have been issued to date.

Social Security card

Social Security card

2. Protect Your Social Security Number and Card

Do not carry your Social Security card on you. Also, avoid carrying any documents on you that include your Social Security number (SSN) or Individual Taxpayer Identification Number (ITIN). Experts recommend not storing your SSN number in your computer for fear of it being compromised.

SSN

SSN

3. Refrain from Giving Your SSN to Businesses

Just because someone asks for your SSN doesn’t mean you’re entitled to give it. You should only share your SSN when it’s required. This will help you protect your SSN and prevent anyone from using it to file a fraudulent tax return, which has become a problem.

Credit Theft

Credit Theft

4. Check Your Credit Report at Least Every 12 Months

You should check your credit report at least every 12 months. If you check your credit report frequently, you can identify the problem before it grows into a full-blown issue. You should always try to check your credit report as often as possible.

firewall software

firewall software

5. Protect Your Personal Computers

Always ensure that your firewalls and anti-virus software are up to date. This will prevent anyone from hacking your SSN from your essential documents stored online. Most people are unaware how easy it is to install spyware on someone’s computer. This is why it’s just best to refrain from storing your personal information on your computer.

6. Review Your Social Security Administration Earnings Statements Regularly

You should review your earnings statement annually. If there is fraudulent activity, you’ll catch it before anyone can do too much damage. Anyone who is using your SSN will be caught when it hits your earnings statement.

Harrassing Telemarketers

Harrassing Telemarketers

7. Don’t Give Personal Information Over the Phone

Avoid giving your personal information over the phone or through the mail. This is yet another way for people to intercept your data and use it for unscrupulous means. It’s best to avoid giving out your personal information over the phone, through the mail, or via the Internet.

Home safe

Home safe

 

8. Secure Your Personal Information in Your Home

Secure your personal information in your home instead of digitally. A fireproof safe is probably your best solution. Though it may seem antiquated not to store these items digitally, it will prevent identity theft if it is stored in a secure safe.

effective strategies

effective strategies

These Strategies Work

As a result of the IRS’s concerted efforts to combat identity theft, the IRS has protected over $63 billion in fraudulent refunds and has ceased 19 million suspicious returns. In 2014, over 1,063 identity theft-related investigations were launched. Last year, there were over 748 sentences given compared to the 438 in 2013, which was a 75 percent increase. The crimes were not taken lightly, and in one instance, one person was sentenced 27 years.

It’s important to the government to resolve these issues, but taxpayers should do whatever is necessary to prevent this from happening. These eight tips are the first steps in the prevention process. Otherwise, you’ll be vulnerable and invite problems. While identity theft is never your fault, you should do whatever is necessary to prevent it. Try these eight strategies. They are effective, and they work.

On the topic of ID theft, make sure that when you file your 1099s, W-2s and other tax forms online, ask your provider about what they do to ensure the information is secure. For the last few years, I’ve used eFile4Biz.com to efile 1099 forms for my clients and their contractors and employees. Their service was touted as being outstanding when asking around my peer groups.

I enjoy the fact that after I file 1099 online for a client, they will also print and send out the form copies to employees. I no longer do that time-consuming work. What a weight off my shoulders.  And, it gives me time to manage clients, instead of sitting at a printer all day. You should check them out below.

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