 Internal Revenue Service IRS tax news, identity stolen? Request an identity protection PIN from the IRS. IR2022-78, April 11th, 2022, Washington. The Internal Revenue Service today reminded all taxpayers, particularly those who are identity theft victims of an important step they should take to protect themselves from tax fraud. So the value of basically identity theft in some areas has actually gone up due to some of the programs that have been put in place to deal with the downturn related to the COVID and so on. And with regards to the taxes, we have things like the refundable credits, the child tax credits, the earned income tax credits that have been increased. We've got that prepayment portion of it. You've got the unemployment that could be involved in different states as well, which could increase the value of basically stealing people's identity. So there's gonna be needed increased protection possibly to safeguard against that. So some identity thieves use taxpayers' information to file fraudulent tax returns. So clearly one of the things people can do with that identity is file a fraudulent tax return in order possibly to take advantage of the increased child tax credit, which has a huge refundable component to it. The earned income tax credit, the recovery rebate, the stimulus checks and so on and so forth. It used to be at some point in time that when your income was below a certain level, oftentimes you didn't even file a tax return at that point because you don't owe any taxes at that point. But at this point, even if your income is low, it's valuable to file the taxes possibly because of all these refundable types of credits, which means there was probably gonna be an increase in the market for people trying to steal identities, even people that have low income identities which might be more especially targeted because they might be able to get these credits if they file a fraudulent return based on them. So by requesting identity protection PINs from the Git and IPPIN tool on irs.gov, tax cares can prevent thieves from claiming tax refunds in their names. So one way to kind of safeguard this at least on the tax side, it doesn't really save you in other areas. People could still try to steal your social security. Number and all this kind of stuff and try to try to identity theft other things such as unemployment, for example. But when it gets to the IRS specifically, which has a lot of targeting at this point because of those refundable credits, you could try to set up another IPPIN which is kind of like a second social security number. And you'll note that the social security number these days is not very optimal for safeguarding and security because obviously we've had it our entire lives and it's been the same number and we've had to give it to every financial institution as well as every workplace, as well as any medical institution for our entire lives. So it's likely that your social security number at some time could be compromised. And once it's compromised in the age of the internet, it's compromised and badly. So what you would think would be a better way to have an identity number would be that it changes from time to time so that if your number does get compromised, then you get a new number within like a year or something like that and that would reset the situation. That's kind of what you're looking at with the IPPIN that you can at least set up possibly for the internal revenue code, although for your taxes, although it does add another level of complication to file the tax returns. So identity protection, PINs and how to get one. An IPPIN is a six digit number the IRS assigns to an individual to help prevent the misuse of their social security number or an individual taxpayer identification number of their wise known as the I-10 on a federal income tax returns. The IPPIN protects taxpayers account even if they're no longer required to file a tax return by rejecting any e-filed return without the taxpayers IPPIN. So in other words, if someone has your social security number and all the other information they need to file the tax return, which isn't much, right? Your name, your social security number, your address and whatnot, then but they don't have the IPPIN, they can't do it. They can't file the electronic return. And if they file an electronic return with your information that causes you a lot of problems because then when you try to file the return it'll most likely get kicked back by the filing software and the IRS will then you'll have to deal with the IRS. And it's a big issue problem, not fun. Don't wanna go through it. Might be better to go through the pain of the IPPIN but that's your call to check it out. So taxpayers should request an IPPIN if they want to protect their SSN social security number or I-10 with the IRS. If they want to protect their dependents SSN social security numbers or I-10 with the IRS. If they think their SSN social security number, I-10 personal identification was exposed by theft or fraudulent acts. So in other words, if you know that someone stole your identity and tried to hack into like your bank account or tried to basically file for unemployment with it or something like that, well then they got your social security number already and don't feel bad about it because I would say a lot of people have their social security number compromised because it's not an optimal kind of number or system to be using in the age of the internet where once something's compromised it's really compromised. So then you might want to, that might give you an added emphasis to possibly try to get the IPPIN. So if they suspect it or confirm they're a victim of identity theft. So taxpayers can go to irs.gov forward slash get an IPIN to complete a thorough authentication check. Once authentication is complete an IPPIN will be provided online immediately. A new IPPIN is generated every year for added security. Once an individual is enrolled in the IPPIN program there's no way to opt out. So there's no way out. So it does add a level of complexity. So you want to think about it. It's still a relatively new thing. I mean they've had the IPPIN for a long time but they usually only opted after someone already got their tax return stolen and they had no other option to stop people from filing fraudulent returns in the future other than doing an IPPIN. But now they're doing it for everybody and that's kind of new. So it's not like they haven't really worked out the bugs cause they've done it for a long time but they haven't really done it without people that haven't already been victimized by a fraudulent return from the IRS being filed typically. So the IRS may automatically assign an IPPIN if the IRS determines that taxpayers a victim of tax related identity theft. The taxpayer will receive a notification confirming the tax related ID theft incident along with an assigned IPPIN for future tax return filing. So if someone filed a fraudulent return with your information you might be forced to do an IPPIN cause that's their only option because once again, once your social security number is compromised in the age of the internet then it's compromised badly. So that's the only solution they really have. So taxpayers will either receive a notice with their new IPPIN every year in early January or the next filing season or they must retrieve their IPPIN by going to IRS.gov, tax related identity theft and how to handle it. Tax related identity theft occurs when someone uses a taxpayer's stolen social security number SSN to file a tax return claiming a fraudulent refund. And obviously again, that has gone up or the desire for that has gone up which will lead people to try to do that more due to the huge increase in refundable credit amounts for like the child tax credit and the earned income tax credit, the stimulus checks, the recovery rebate credit and on and on. So in the vast majority of tax related identity theft cases the IRS identifies a suspicious tax return and pulls the suspicious return for review the IRS then sends a letter to the taxpayer and won't process the tax return until the taxpayer responds. So if they get a suspicious return, they might pull it. Depending on the situation the taxpayer will receive one of three letters asking them to verify their identity you might get a 5071C, ask them to use an online tool to verify their identity and tell the IRS if they filed the return in question letter 4883C asks the taxpayer to call the IRS and verify their identity and tell the IRS if they filed the return. For those who have been a victim of data breach they may receive a letter 5747C and be asked to verify their identity in person at a taxpayer assistance center. So you gotta make sure you wear your mask and distance when you get that letter. So if the taxpayer receives any of these letters they don't need to file an identity theft affidavit form 1439. So the identity theft affidavit is usually used after someone has actually stolen your identity. So note that's different than the IPPIN which you're gonna opt in. If someone has not yet stolen your identity and you're trying to prevent them from stealing your identity and I'm talking in terms of filing like a fraudulent tax return. If you think someone filed a fraudulent tax return because when you tried to file for example it got kicked back and said that someone already filed a return then I believe that's the time when you might have to file an identity theft affidavit and report that and in the process of doing that the IRS may then issue you an IPPIN to stop future acts of fraud and stolen identity. So instead they should follow the instructions and the letter. When to file an identity theft affidavit if a taxpayer hasn't heard from the IRS but suspects tax related identity theft they should complete and submit form 1439 identity theft affidavit signs of possible tax related identity theft include a taxpayer can't e-file their tax return because a duplicate tax return was filed using their social security number. Check that there's no errors in the SSN such as transposed numbers. A taxpayers can't e-file because a dependent social security number or ITIN was already used by someone on another return without the taxpayer's knowledge or permission. Also check that the SSN so obviously dependent social security numbers are valuable due because they could qualify for the earned income tax credits the child tax credit and the increase the amount of the stimulus check the recovery rebate credit and so on. So children they've the tax code has made children into a commodity at these points. So protect them. So a taxpayer can't e-file because a dependent social security number or ITIN was already used by someone on another return with the taxpayer's knowledge or permission. Also check that the SSN or ITIN is correct and be sure the dependent hasn't filed a separate tax return. A taxpayer receives a tax transcript in the mail they did not request. A taxpayer receives a notice from a tax preparation software company confirming an online account was created in their name and they did not create one that's not right. A taxpayer receives a notice from their tax preparation software company that their existing online account was accessed or disabled when they took no action. So you got to check into that. Don't just let these things go. You want to like look into it. Don't click on anything on the email that says that because it could be a spam thing. You got to watch out for that too but go directly to the site and try to figure out you know what's going on. A taxpayer receives an online notice informing them that they owe additional tax or their refund was offset to balance due or that they have had collection action taken against them for the year they did not earn any income or file a tax return. The IRS sends a taxpayer a notice indicating that the taxpayer receives wages or other income from an employer for whom they didn't work. The taxpayer has assigned an employer identification number an EIN but they did not request or apply for an EIN. The IRS will work to verify the legitimate taxpayer clear the fraudulent return from the taxpayer's account and generally place a special marker on the account that will generate an IPPIN each year for the taxpayer who is a confirmed victim. So you don't really wanna be a confirmed victim. So you might wanna do the IPPIN proactively to stop that but if you're a victim you know it's not a lot of people are these days of the identity thefts especially with the increase in the benefits and whatnot. So you might get an IPPIN after you go through the tedious process of figuring out and stopping and reversing the fraudulently filed return. For information about tax related identity theft see identity protection, prevention detection and victim assistance and IRS identity theft victim assistance how it works on irs.gov. The Federal Trade Commission website also includes information about tax related identity theft. Signs of non-tax related identity theft no need to file form 14039. Non-tax related identity theft occurs when someone uses stolen or lost personal identifiable information PII to open credit cards obtain mortgages by our car or open other accounts without their victim's knowledge. So if someone stole your identity and they did all these other things then you don't have a lot of recourse with the IRS about that of course. You only have recourse for the IRS if they stole your stuff to steal IRS stuff like these refundable credits. So you got to go through other means to try to figure all this other stuff out which would kind of be nice if you had another number that they could use that they actually did a social security number system that maybe changed or something considering the old system is kind of out of date these times. I don't want to chip in my forehead or anything like that I'm just saying like a number maybe that changed or anything I don't want anything physically implanted or something but any case potential evidence of non-tax related identity theft can include an individual receives balanced due bills from companies with whom they didn't conduct business magazine subscriptions or they didn't order notifications of a mortgage statement and or credit cards for which they didn't apply an individual receives notices of unemployment benefits for which they didn't apply an individual receives a notice CP01E employment identity theft an individual receives a W-2 1099 from a corporation or employer from whom they did not receive the income reported and they have not received a notice or letter from the IRS requesting them about that income. A taxpayer can't e-file because dependent social security number or I-10 was already used by someone who is known to the taxpayer but is not the patient parent or legal guardian and the taxpayer did not provide permission for that person to claim dependent for additional information about this issue see publication 1819 divorce and non custodial separated or never married parents there's a link to that here victims of non-tax related identity theft don't need to report these incidents to the IRS because the IRS isn't going to do anything about them so you might not might as well not waste your time trying to do that if it's non IRS related but I should take steps to protect against the type of identity theft they've experienced so obviously you could protect then you have to take other steps to protect your bank accounts and your all your other kind of stuff and you might want to take proactive action because now they have that information to go after your IRS or file a fraudulent return that's when you might want to file the I-PEN that would prevent them from doing that in a proactive way