How to protect yourself against tax identity theft

Tax identity theft occurs when someone takes your personal information and uses it to file a fraudulent return to get a refund from the IRS. They have the refund sent to their own bank account. Then, when you go to file your return, the IRS might reject it because it sees your return as a duplicate.

Here are some important steps from the IRS you can take to protect your personal information and make yourself less vulnerable and help to protect against identity theft:

• Protect your Social Security number (SSN). Treat your SSN as confidential information. Don’t give any business your SSN unless you have a legitimate reason.
• Don’t carry your Social Security card or other documents that include it in your wallet or purse. Instead, keep them stored securely at home.
• Check your credit report periodically for strange activity. Set up notifications for any activity on your account, such as large transactions, withdrawals, and statements.
• Protect personal computers and other electronics with firewalls and software updates. Enable multi-factor authentication on all online accounts that house private information.
• Use strong passwords with a mix of letters, numbers and special characters, and change them regularly.
• Don’t give your SSN or other personal information out over the phone unless you initiated the call and know it’s a reliable person or agency requesting it. H&R Block and the IRS will never call you to ask for your SSN or personal information.
• Be cautious on social media sites and do not click on suspicious links. Avoid entering personal information into a web form unless you’re absolutely sure it is legitimate. 
• Report lost or stolen debit/credit cards or unauthorized transactions to your financial institution as soon as you notice them.

Handling a case of tax identity theft can take months – and that means it will take longer to get your tax refund. The burden of proving that the first return is false rests on the victim. You would have to provide proof that you are the legitimate filer and the other return is fraudulent. Most importantly, you have to show you didn’t receive the refund.

What’s being done to address identity theft?

For one, the IRS has instituted the Identity Protection Personal Identification Number (IP PIN) program that prevents anyone else from filing a tax return using your Social Security Number or Taxpayer Identification Number. The IP PIN is a unique identifier that is only available to the rightful owner of the return.

The IP PIN changes every year, and once you start using an IP PIN, you have to use one on every return you file. The IRS will issue your annual IP PIN via mail using a CP01A Notice and it can also be viewed on your IRS account.

H&R Block is also working to better protect you from tax identity theft. Read on to learn more.

What is Tax Identity Shield^®?

Our Tax Identity Shield^® service offers unique tools to help you better protect yourself from this painful problem. It also gives you confidence knowing you’re taking steps to help reduce your risk of becoming a victim when you file your next return.

There are several features included in Tax Identity Shield^®.

Tax Identity Theft Protection features

• Dark Web monitoring – We conduct a daily scan of places on the Dark Web where personal information is being traded or sold online. If we find that any of your data elements (up to 63 different items) may be for sale, we’ll alert you about which pieces are vulnerable and what you can do to protect that data.
• IRS Protection Assistance – We’ll help you request an IP PIN from the IRS¹.
• Education – From self-assessments to email newsletters and breach alerts, we’ll keep you informed of tax identity theft-related issues that might affect you.
• E-File Monitoring – We’ll monitor your tax return information in our H&R Block system and inform you if someone tries to e-file a tax return through our system using your personal details.
• SSN alerts – We will perform a scan and provide a report of the names and addresses associated with your SSN credit header data.

Tax Identity Restoration features (if you become a victim next year)²

• Tax Identity Restoration Assistance – We will assist you as you work to restore your tax identity. The restoration assistance includes helping you in getting your individual income tax returns successfully filed, obtaining your proper refund (if any), and helping you to understand the steps you need to follow to restore your tax identity.
• Additional Protections – We provide you a one-year enrollment in identity monitoring services, including your credit score and credit reports. We’ll also help you place fraud alerts for your financial accounts, making it harder for thieves to access your information.

To learn more, talk with your H&R Block tax professional or visit the Tax Identity Shield^® website.

What if my identity has already been stolen?

If you go to file your tax return this year and discover that someone has already filed a return using your personal information, H&R Block can still help. Talk with one of our tax professionals and sign up for Tax Identity Shield. This service will work retroactively to:

• Help you file the correct form with the IRS
• Give you a checklist so you know the steps to take to make the necessary police reports
• Provide you assistance so you can notify the credit bureaus as well as the FTC and Social Security Administration
• Help you with additional protections based on your level of exposure

Tax identity theft can be frustrating, but we’re here to help make it a little easier on you.

For more on this topic, visit the IRS website.

Footnote 1: Qualifying individuals only. See www.irs.gov for qualifications.

Footnote 2: Please refer to your Tax Identity Shield^® Terms, Conditions and Limitations document for a complete description of Tax Identity Shield^®, as well as applicable conditions and limitations.