IRS Scam

IRS Scam: a reader talks about…

I recently had a real problem with my tax return and the IRS, which I thought I’d share with you and your readers. I was one of the hundreds of thousands of US taxpayers who got scammed by fraudsters who took over my IRS tax file. Someone registered with the IRS and got access to my tax returns and filing information. I didn’t lose my refund, but it took some time to get everything fixed. You should tell your readers about http://www.irs.gov/Individuals/Get-Transcript and the toll-free number at IRS: 800-908-4490

Thanks for the link, consider it passed on! Back in May, the IRS admitted that it had been hacked. The number of taxpayers who’s tax info was compromised started at 110 thousand and was recently reported at 330 thousand. A hacker could register with the IRS using his/her own email address and then get access to your tax info. Some folks even got their refunds stolen. In all, a really bad situation, and so far the IRS still hasn’t fixed everything.

So here’s what every US taxpayer should do: Register with http://www.irs.gov/Individuals/Get-Transcript (the service is currently down but keep checking back and register when you can). The IRS identity theft hotline phone number the reader referenced is also not working at this time, but keep it for the future. In all, the IRS doesn’t seem to be working very hard to make the process any easier or better. So perhaps a letter to your Congressman might be worthwhile, although the current US Congress doesn’t seem likely to increase the IRS budget to allow for more and better customer service.

If you think your tax return has been subject to fraud, you can fill out and mail in an IRS form 4506, along with a $50 processing fee and get by return mail a copy of the fraudulent return that was filed in your name, along with information on where the refund was sent. You can also order it online here. You can also report the scam to the US Treasury (at https://www.treasury.gov/tigta/contact_report_scam.shtml). But these are just baby steps, you may have to take on a lot more work if you want to track things down and get your situation resolved. It appears that the IRS identity validation process is so broken that rampant identity theft and thievery is absurdly easy (read more details about this at Krebs on Security).

Lastly, as I recommend in my Safe Computing Practices, you should sign up for credit monitoring and turn on a fraud alert on your file (such as through Equifax), along with watching all your financial transactions (bank, credit card) on a regular basis.