A fairly new type of fraud being perpetrated on taxpayers employs the use of a taxpayer’s identity to file a fraudulent claim to receive a refund. While this is a form of identity theft, it differs somewhat in that the only information required is the individual’s name and social security number. Once obtained, the fraudster files a false tax return under that name and social security number, claiming a refund is due and if the return makes it through the IRS system, a check will be generated to the defrauding party.
Last year, some taxpayers only learned that they were
victims when they attempted to file their returns electronically only to have
the IRS tell them a return had already been filed in their name. Since this manner
of fraud was relatively new last year, the IRS had very few systems in place to
cope with the problem.
This year, the IRS is very aware of this type of fraud and
is actively working to identify fraudulent returns and find the perpetrators. Because
there was a major surge is this type of fraud during the 2012 tax season, the
IRS put significant resources into reducing the attractiveness of this type of
activity by making is harder to get a fraudulent return through the system. The
IRS now has over 3,000 specially trained employees assigned to work in this
When two returns are filed under the same social security
number, the IRS is notified. Once the rightful owner of the social security
number shows their legal ownership, the IRS issues a unique identification
number to them which they will continue to use in future years when filing
their returns to avoid additional problems.
If you find that you have been a victim of this
type of identity theft, you will need to complete an Identity Theft Affidavit
and provide it to the IRS. The form is available online at http://www.irs.gov/pub/irs-pdf/f14039.pdf.
At this point, the IRS will begin verifying you as the owner of the social
security number and issuing you the unique ID number. To speak with an IRS
representative about the identity theft prevention program, call 800-908-4490.