February 27, 2020 | Posted in:

Protect Yourself from Fraudsters this Tax Season

Identity theft is a growing risk in the digital world.  It has become harder and harder to protect your information online.  It is important to take extreme caution with your personal information during tax season and beyond.  Make sure you are taking the necessary steps to protect your identity.

Here are some tips to keep your personal information safe and avoid theft.


Send securely and file early

When providing information and tax forms (W2s, 1099s, K-1s, etc.) to your accountant or tax preparer, be proactive in using secure measures such as a client portal, encrypted email messages, a protected online file transfer, or a password-protected USB flash drive. While email is fast and convenient, it comes with risks.

In addition, try to gather your documents and file your tax return as early as possible. The sooner you file your return, the less chance you have of someone attempting to file a fraudulent return in your name or falsely claiming one of your dependents. If you go to file your return and discover a return was filed in your name, alert the IRS by completing Form 14039 – Identity Theft Affidavit. You can also request a copy of the fraudulent return using Form 4506F – Request for a Copy of a Fraudulent Tax Return.


Properly dispose of any documents with sensitive information

During tax season, a lot of supporting documents and statements may come your way to aid you in preparing your tax return. Make sure any document with personal or financial information is shredded.  Specifically, make sure you are protecting your social security number.  If a document with this information gets into the wrong hands, it could cause a whole host of problems for you—and your credit.


Check your banking and credit card app regularly

Whether you use an app or website to check your personal cash flow statements, make sure you do so often.  Stay on top of the transactions you are making and continuously assess them to make sure no foreign charges appear.  If there is a charge you did not administer, call your bank or credit card company directly.


Implement password differentiation

Make sure you are using a different and unique password for your various online accounts.  That may seem inconvenient to you, but creating a unique password makes it harder for cyber criminals to try and guess your login information.  If they are able to seize one of your passwords, having different credentials means they won’t be able to gain access to any of your other accounts.


Withhold your information

You should be very careful where you share your information.  The IRS will never email or call you directly so you should never have to communicate your personal information this way.  If you use your email for receiving personal or financial information, make sure you are not inputting your password into any external links. Keep in mind the IRS will never request payment via gift cards, prepaid debit card, or immediate wire transfer.  If someone is asking for your personal information and demanding payment specifically by gift card, consider it a major red flag.


Multi-factor authentication

Although multi-factor authentication can be a hassle, it is a good way to secure your online accounts.  It is a smart idea to set up two-factor authentication if it is an option.  Two-factor authentication can help protect your account if a cyber criminal gets a hold of your login information.


Check out the IRS Identity Theft Central webpage for more information about how to protect yourself and what to do if you are a victim of identity theft.


As always, Alloy Silverstein is here to help.  Using our client portal can help keep transmission of your sensitive tax documents secure and out of the wrong hands. If you suspect you are a victim of fraud, ask your accountant about our Identity Theft Defense to protect yourself from further vulnerabilities.


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