South Carolinians learned in a high-profile way in 2012 about the theft of tax information.
Up to 3.6 million returns from as far back as 1998 may have been compromised by international hackers penetrating the S.C. Department of Revenue’s system.
Since that time, awareness and prevention of identity theft have become top priorities for government and individuals.
This year, the SCDOR is telling South Carolinians that income tax refunds will take longer to process because of new fraud-detection and prevention measures.
Waiting for money won’t make people happy, but it’s a small price to pay for efforts to ensure the protection of the tax system and the key information it possesses about taxpayers.
“Our No. 1 priority is to make sure your refund ends up in your pocket,” SCDOR Director Rick Reames III advised South Carolina taxpayers. “We will not simply stand by and allow thieves to prey on hardworking taxpayers and steal from our state.”
That won’t stop people from trying to do just that. Nationally, tax refund fraud – people filing false returns to steal taxpayer refunds – is growing at an alarming rate.
Stolen tax identify refund fraud is a million-dollar business – for the fraudsters. In 2013, the last year of available statistics, the IRS identified almost 3 million potential fraudulent returns. That same year there was more than $5 billion paid out in fraudulent refunds.
This week is Tax Identity Theft Awareness Week, which comes at precisely the right time with so many focusing on filing tax returns.
The IRS wants you to know that it uses your Social Security number 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, but the IRS stresses that it 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 email@example.com.
If someone uses your SSN to file for a tax refund before you do, the IRS says it 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.
If you think someone used your SSN for a tax refund or a job — or the IRS sends you a notice or letter indicating a problem — contact the IRS immediately. Specialists will work with you to get your tax return filed, get you any refund you are due and protect your IRS account from identity thieves in the future.
While everyone’s hope is to be unaffected by tax identity theft, taking immediate action is important if you are. Contact the Internal Revenue Service at 1-800-908-4490 and visit IdentityTheft.gov to report and recover from identity theft.