DES MOINES, Iowa, March 3, 2015 /PRNewswire/ -- Recently, TurboTax temporarily suspended e-filing for state tax returns due to an increase in fraudulent filings. Although the company's investigation found no breach within its own system, many still wonder: is filing taxes online safe?
Last year, the IRS paid an estimated $5.2 billion in fraudulent tax returns.1 While no evidence suggests filing online increases taxpayers' chances of becoming victims of tax identity theft, it does seem that filing fraudulent returns online is easier for criminals.
To file a fraudulent online return, all criminals need is a name, date of birth and Social Security number. Then they forge a W-2 and e-file with ease, knowing that the IRS doesn't verify returns before paying out refunds. The first time the IRS becomes aware of the problem is when a second return is submitted for the same taxpayer.
So what can taxpayers do to protect their identities and tax refunds? ARAG®, a leading provider of legal insurance, offers three actions you can take to increase your chances of a theft-free tax season.
- Protect yourself year-round. "The tax identity theft process can begin months before criminals file your taxes," says Ann Cosimano, ARAG General Counsel. "Cybercriminals constantly search underground websites for Social Security numbers and other personal data that has been mined from various accounts and sites. The more of your data they find throughout the year, the more likely you are to be a victim of identity theft." One way to know if and when your information appears on these sites is to use an internet surveillance program that regularly scans the web for any suspicious activity.
- File as early as possible. "Because the IRS operates on a 'pay refunds first, ask questions later' model," Cosimano explains, "the sooner you file, the less likely someone else will file in your name before you do." If a criminal does beat you to the punch, the IRS estimates it will take 180 days to resolve your case.2
- Be smart about scams. A popular tax scam involves criminals posing as IRS employees and calling taxpayers to tell them they owe the IRS money. They demand payment by wire or a prepaid debit card. "Keep in mind that the IRS generally contacts taxpayers by mail, never by email, phone call or text," Cosimano says. The IRS also doesn't specify forms of payments. If you are contacted by someone claiming to be from the IRS and think it's a scam, contact the IRS Identity Protection Unit at 800-908-4490.
To further protect your identity at tax-time and year-round, check with your employer about enrolling in a legal insurance and identity protection plan. Comprehensive plans, such as those offered by ARAG, provide plan members with internet surveillance and credit monitoring services, in addition to immediate access to attorneys and specialists.
1"Identity Theft: Additional Actions Could Help IRS Combat the Large, Evolving Threat of Refund Fraud." U.S. Government Accountability Office. August 20, 2014. http://www.gao.gov/products/GAO-14-633?source=ra
2 "National Taxpayer Advocate Delivers Annual Report to Congress." Internal Revenue Service. January 9, 2013. http://www.irs.gov/uac/Newsroom/National-Taxpayer-Advocate-Delivers-2012-Annual-Report-to-Congress
About ARAG:
ARAG ® (www.ARAGgroup.com) is a leader in legal insurance. It provides people with affordable and reliable legal counsel for everyday life matters. The company has an international premium base of more than $2 billion and protects 15.5 million individuals and their families – worldwide. We give you the freedom and control to embrace life's opportunities.
ARAG's North American headquarters are based in Des Moines, Iowa. We've earned the prestigious Center of Excellence Award for eight consecutive years (2007-2014) and have been named a Top 100 Call Center by BenchMark Portal for four consecutive years (2011-2014), continuing our track record of industry-leading customer service. ARAG team members voted ARAG a Best Places to Work in Insurance (2009-2014).
For more news and information about ARAG visit ARAGgroup.com.
Media Contact:
Jen Harken, Corporate Communications Manager
[email protected] or 515-237-0271
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