According to the IRS, individuals filed more than 150 million tax returns during the 2016 tax year. That equates to the IRS collecting a lot of money and having access to even more personal information. It should then come as no surprise that identity thieves focus on stealing tax information from individuals. Here are a few things the average taxpayer can do to reduce his or her chances of having their tax information stolen.
Tip #1: Protect Your Social Security Number
This nine-digit number is the IRS’ primary means of identifying individual taxpayers and is the single more important piece of identifying information on a tax return. Without a social security number, it’s much harder for criminals to steal an individual’s identity and file a fraudulent tax return. One way to help protect a social security number is to keep the social security card in a safe place and never carry it around unless you absolutely have to.
Tip #2: Beware of Phishing Emails
These seemingly official emails are simply a tool for duping an unsuspecting individual into revealing personal information. Keep in mind that the IRS (and practically all reputable companies) will not ask for personal or financial information via email.
Tip #3: Protect Your Snail Mail
Don’t let unscrupulous people go through your mail. You can prevent this in two significant ways. First, try to retrieve your mail as soon as possible after it has been delivered. If you’ll be unable to do so for an extended period of time, have the post office hold your mail until you can check it again regularly or have a neighbor your trust empty your mailbox for you.
Second, you can lock your mailbox so that the postal delivery person can still drop off the mail, but a key is needed or remove the mail. A determined criminal can still access your mail, but the lock will be a strong deterrent.
Tip #4: Shred Documents Containing Personal Information
Old tax documents, bank statements and billing records are a gold mine to identity thieves. To avoid someone from stealing your identity by going through your trash, shred these types of sensitive documents before throwing them away. If possible, use a cross shredder for added security.
Tip #5: Use Good Passwords
What makes a password good? For one thing, you only have one password per online account. This means some hacker who breached your online bank account and has stolen your password can’t also use that password for your online credit card or mobile phone accounts.
Another thing that makes a password good is that it’s not in plain English. This means it has random symbols, capital letters and alternative spellings. Yes, it’ll be hard to remember, but it’ll make even the most determined hacker think twice before using a brute force password attack.
Tip #6: Use an IP Pin
With such reliance on the social security number, the IRS has a special program that allows taxpayers to use a predetermined six-digit number on their tax returns along with a social security number. This IP PIN makes it that much harder for a tax thief to file a fraudulent tax return pretending to be you.
Even with the above tips, nothing beats common sense and a willingness to put a little bit of extra effort into keeping tax information as safe as possible.