You’ve filed your taxes. Your refund has arrived — or is on the way. It’s a great time of the year to take some steps to prevent yourself from being a victim of a growing type of crime each year at tax time.
An increasing number of identity thieves nationwide are using stolen Social Security numbers to file false claims for tax refunds, tapping into a huge source of cash. Each year, nearly three-quarters of taxpayers receive refunds after filing taxes because they have too much money withheld from their paychecks. The average refund amount? Around $3,000. With this type of fraud, a tax refund is mailed directly to the crook. Oftentimes, the victim of the crime finds out only after filing a legitimate tax return and the IRS notifies them that a return already has been filed on their behalf.
So what can you do to avoid becoming a victim? Think about taking some important steps to protect your personal information. Don’t just throw paperwork containing your information in the trash. Shred anything with your name, address and other personal information before you throw it away. Keep your financial documents stashed away, preferably in a safe. Watch your mail and pick it up every day if possible. Consider using a locked mailbox. Do you get a big tax refund each year? Think about adjusting your withholding so that next year, you don’t get much of a refund – if at all. That way there’s not a huge sum for a scam artist to steal! Just check with your tax adviser to see if that’s the right step for you.