What is Identity Theft? 

Any type of identity theft can disrupt your finances, credit history, and reputation, and take time, money, and patience to resolve.

Often, identity thieves will use a Social Security number, mother's maiden name, date of birth, or account number to open fraudulent new credit card accounts, charge existing credit card accounts, write share drafts, open share accounts, or obtain new loans.

You may already know that identity theft is a serious crime.  You take steps to protect your personal information by not opening unrecognized emails and shredding important documents.  But, do you know how to recognize and prevent from becoming a victim of tax identity theft?

Tax identity thieves may use your Social Security number to get a tax refund or a job. If the IRS if sends you a notice saying their records show:
•You were paid by an employer you don’t know, or
•More than one tax return was filed using your Social Security number, contact the IRS Identity Protection Specialized Unit at 1-800-908-4490.

What Steps Can You Take To Prevent Tax Identity Theft?

1. Get an Identity Protection PIN (IP PIN) from the IRS. What's an IP PIN? An IP PIN is a six-digit number assigned to eligible taxpayers that helps prevent the misuse of your Social Security number on fraudulent federal income tax returns. You can’t use the IP PIN as your e-file signature PIN.  You can learn more about an IP PIN from the IRS.

2. Check your mail and credit union account statements every month. If you discover an account you did not open, balance discrepancy, or a purchase you did not make, contact the financial institution or creditor immediately to report the activity.

3. Monitor your credit reports on a regular basis. Do you really know what’s on your credit report?  Why it matters?  Or, how to obtain your three free credit reports annually?  You can find answers to these questions and more about credit reports and credit scores in NCUA’s Credit Reports and Credit Scores learning center.

4. Talk to your credit union about the identity theft resources they may offer. Most credit unions offer or partner with companies that offer services and materials to help their members safeguard their accounts.

5. Visit MyCreditUnion.gov MyCreditUnion.gov and Pocket Cents, NCUA’s financial literacy microsite, offer a wide range of informational articles on finance, fraud prevention, as well as multiple financial tools and resources.  Keep up to date with current hot topics on fraud prevention, savings, and debt reduction.

Uncovering Tax-Related Identity Theft

The IRS uses your Social Security Number (SSN) to make sure your filing is accurate and complete, and that you get any refund you are due. Identity theft can affect how your tax return is processed. An unexpected notice or letter from the IRS could alert you that someone else is using your SSN; however, the IRS doesn't start contact with a taxpayer by sending an email, text or social media message that asks for personal or financial information. If you get an email that claims to be from the IRS, do not reply or click on any links. Instead, forward it to phishing@irs.gov.

If someone uses your SSN to file for a tax refund before you do, the IRS might think you already filed and got your refund. When you file your return later, IRS records will show the first filing and refund, and you’ll get a notice or letter from the IRS saying more than one return was filed for you.

If someone uses your SSN to get a job, the employer may report that person’s income to the IRS using your SSN. When you file your tax return, you won’t include those earnings. IRS records will show you failed to report all your income. The agency will send you a notice or letter saying you got wages but didn’t report them. The IRS doesn’t know those wages were reported by an employer you don’t know.

To read this full article and learn other steps to repairing identity theft, click here.