It's easy to postpone tax return preparation, but doing so could end up costing you. Failing to meet critical deadlines could result in penalties and fees. It could also make you vulnerable to tax-related identity theft. This refers to scenarios in which scammers use other people’s personal information to file fraudulent returns that yield refunds. 

How Does Tax-Related Identity Theft Occur?

Individuals who commit tax-related identity theft have a number of strategies to obtain their victim’s personal data. For example, they might send official-looking emails requesting information like Social Security numbers and banking passwords.

Intercepting credit card solicitations and other kinds of mail is another common way to obtain personal information. Large-scale data breaches also expose consumers to identify theft. 

How Can I Protect Myself From Tax-Related Identity Theft?

Take a proactive approach to tax return preparation and file as soon as possible. Submitting a prompt return allows the IRS to process it before the thief has time to submit a fraudulent one.

As for protecting your personal information to mitigate identity theft in general, change your online passwords often and follow up with institutions that inform you of breaches that might’ve compromised your data.

You should also protect your personal computer against viruses and spam and wipe the hard drive clean before selling or donating it. Additionally, don't log into personal accounts when using a public Wi-Fi network. Finally, remember that the IRS will never reach out via email nor will they request your Identity Protection PIN via phone. 

As soon as you’re ready to start tax return preparation this year, turn to Burch & Associates. Located in Lincoln, NE, this accounting firm is comprised of Enrolled Agents, who are equipped to assist with all your tax-related needs. Serving individuals and businesses around the country, they know how to mitigate all kinds of tax liabilities. To learn more about their services, visit their website. To make an appointment, call (402) 483-4791.