The tax season is considered to be the best opportunity for scam artists to earn quick money by stealing identities from unsuspecting taxpayers. Usually, taxpayers don’t even realize that their identities were stolen unless they are cited by the IRS over non-payment of taxes due, or when they are unable to file their returns on time due to fraudulent or fake entries made by an imposter. Identity thieves are known to claim hefty refunds using stolen identities and are also known to tamper with checks and online banking accounts to transfer money into their own accounts.
E-filing and sharing sensitive documents with the IRS, auditors, accountants, financial planners, and banks through electronic mediums are prime reasons behind identity theft, but cunning perpetrators also find numerous other ways to steal confidential information from taxpayers. It is estimated that more than 10 million taxpayers are affected in the US during a tax season, and the FTC (Federal Trade Commission) expects the number to surge with every passing year. An increasing number of people are subjected to identity theft mainly due to a lack of understanding of the proper ways to safeguard their personal information. If you are worried about protecting your sensitive information, here are 6 steps to prevent identity theft during this tax season.
1. Track Your Credit
You should make it a priority to keep tabs on your credit score and take immediate action if you see any type of erroneous or fraudulent activities. You should also keep a constant lookout for your bank balances and credit card statements, and keep track of your credit cards to ensure that no new cards are issued in your name without your consent. Always check in with your financial planner or accounting firm to tally up your financials and ensure that they are in order. It is also a good idea to file your tax returns well in advance and avoid waiting until the last moment. This will deter identity thieves from filing tax returns and claiming a refund on your behalf.