Avoid identity theft from fraudulent tax returns

If there were ever a reason to get an early jump on filing your taxes, avoiding identity theft would be pretty incentivizing, right? Crooks can make bank on your IRS return each year — but I have a few suggestions to keep you in the clear.

In today’s episode of Your Money Minute with Tracy Stewart, CPA, I want to talk about tips to avoid identity theft with your tax returns. Doing your taxes may feel like a real pain — but it’s time to yank off the Band-Aid, because thieves can end up cashing out on your return and leaving you with a mess to clean up.

It’s the same story every time: You try to submit your taxes, and the IRS greets you with a lovely message that says there’s already a return on file for your social security number. Best advice to avoid this scenario? Don’t drag your feet. Get a jump on your returns as soon as you can. If you can’t avoid to file — then start saving money earlier (or you’ll leave yourself open for a big mess.)

If you’re concerned about a fraudulent return being filed with your SSN, you may apply for a PIN number with the IRS. Without this number, a return cannot be filed. If you’ve had a fraudulent return filed in your name before, they’ll give you a PIN automatically. If you’ve dealt with identity theft in the past, you can apply and you’ll likely get one, as well. If you’re just concerned and want one, you can always ask — and they may give you one, too.

Financial independence is unbelievably liberating. To get the kind of financial independence you want, you need to minimize the risk that identity thieves can take your wealth — and filing your taxes earlier will do this.

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