Avoiding Tax Refund Fraud: 3 Things to Know
Tax-refund fraud remains a huge problem. Scammers have gotten away with billions of dollars in recent years and stolen the identities of a bewildering number of people.
Will the 2017 filing season be any better?
Here are three things to know to help minimize the risk that you your refund or your identity will be stolen.
Filing early can help prevent refund fraud.
This year, tax filing season opens on January 23. But employers are not required to provide W-2 and certain 1099-MISC information to the IRS until January 31.
The January 31 date is earlier than in the past, when employers had until the end of February. Congress moved it up this year to help prevent tax-refund fraud. Without the W-2 and 1099 information, cross-checks by IRS computers are unable to assess whether income claimed on a return is accurate – and raise red flags if it’s not.
It can therefore help to file your taxes right away, so that the IRS can get your information checked as soon as possible and possibly prevent someone from filing in your name.
Protecting your personal information really is important.
Be very careful with your Social Security number and other personal information. Don’t carry a paper copy of your Social Security card in your billfold or purse. And develop good computer security habits, such as creating strong passwords and being wary of insecure networks.
You should also be on guard against fraudsters who pose as IRS agents, either by phone or online.
And if you use a tax preparer, make sure it’s someone you trust.
Taking these steps can help keep your information away form fraudsters who could file a return in your name.
The IRS is holding certain refunds this year until February 15.
The IRS announced last week that it will not issue certain tax refunds until February 15. This applies to returns that claimed the earned income tax credit (EETC) or the additional child tax credit (AATC).
The purpose of the hold is to give the IRS more time to uncover possible tax refund fraud.
