Tax ID Fraud: It's a Thing... and Here's How to Avoid It
There's a new reason to stop procrastinating about filing your taxes, and it's not just about getting that refund check. Tax ID fraud is a real thing, and in 2012, $11 billion dollars was fraudulently refunded. Lynnette Khalfani-Cox, The Money Coach, says that the IRS has an entire department to handle the issue... staffed with over 3,000 people.
The scammers steal your Social Security Number, file taxes in your name and take your refund.
This is particularly a problem for people who wait until the April 15 deadline to file. Lynnette says you should file early to avoid this because if you are a victim of tax ID fraud, you could be looking at 6 months of sorting out the issue. This will not only delay your tax refund, but you also have to take the time to prove your identity to the IRS. Lynnette is estimating that 2.5 million people fell victim to this in 2013; the IRS reported that 1.2 million people fell victim in 2012.
Will you file your taxes early to avoid this? Tell us in the comments.