Identity Theft and the IRS


A client called the other day to say that she had received correspondence from the IRS. The first line of the letter read:

Dear Taxpayer:

We have received your income tax return and are holding your refund until we complete a thorough review of your return.

The problem is my client has not yet filed her tax return.

Someone had stolen her identity and filed a fraudulent return using her social security number. My client and I are working on straightening out this situation. Listed below are the steps recommended to her by the IRS:

  • Review the portion of the IRS Website devoted to identity theft.
  • Call your state Department of Revenue to report the identity theft. In Iowa, the number is 1-866-339-7912 or visit the Iowa Department of Revenue’s website.
  • If you receive a similar notice from the IRS (it will come by regular mail, not email), call them immediately. It is a long wait on the telephone this time of year, but you need to report it right away. Follow up with a letter to the IRS even if they say it is not necessary.
  • Call the FTC Hotline – 877-438-4338 – and report that a fraudulent tax return has been filed using your social security number.
  • Call the Social Security Administration at 1-800-772-1213 and report the theft of your identity.
  • Call one of the three credit bureaus to report the fraudulent activity and to see if there is theft other than the fraudulent return.
    If you call one bureau, they will report to the others:
              • Experian - 1-888-397-3742
              • Trans Union - 1-800-888-4213
              • Equifax - 1-800-685-1111

Although you will not lose your refund, you can expect delays in the processing of your return if a fraudulent return has been filed using your name and social security number. A special affidavit concerning the identity theft must be filed with your actual return and the return must be filed in paper form. An electronic filing will not be acceptable.

Margaret Van Houten
Tax Law Iowa

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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