Inside TDV - The Data Vault Blog

Protecting Taxpayer Identities

Benjamin Franklin’s famous adage states that “the only certain things in life are death and taxes”.

But it turns out that one of these might be a lot less secure than previously thought. Considering the seriousness of the information handled, identity theft and tax fraud involving IRS accounts is surprisingly prevalent nationwide. As detailed in this recent investigative report, the case of a Spokane, Washington resident raises questions about how personal information is confirmed and the efficiency of existing fraud monitoring programs. While the issue was taken care of and no erroneous penalties were assessed, the fact that 1.6 million accounts faced identity theft issues in the first half of 2013 alone seems to indicate a growing issue for the agency.

The IRS is aware of the complaints and is taking steps to address it (nearly 3,000 employees work on refund fraud year round) but as modern technology evolves it is hard to keep up with the sheer amount of criminal activity. One of the most common scams involves telephone calls to elderly people, complete with fake badge ID numbers and impersonated agents, while another comes from imitating official communications from a local banking office. According to an agency spokesman, however, “The IRS will always send taxpayers a written notification of any tax due via the U.S. Postal Service, and never asks for debit, credit or prepaid card information over the phone.”

As with any form of identity theft, there are steps you can take on a personal level to help secure your future returns and accurate tax reporting. Checking your credit report every year, protecting your computers with current antivirus software, not giving out sensitive information over the phone, and shredding personal documents can prevent it from falling into the wrong hands. However, if you do suspect fraudulent activity the easiest way to report it and get the issues resolved is to contact the IRS Identity Protection Unit at (800) 908-4490, ext. 245.



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