You are most likely aware of the recent news stories about the growing problem of identity theft in the tax area. The identity theft is usually only discovered when a person goes to file their return and discovers that a tax refund has already been issued based on an earlier fraudulent return. The result is an administrative nightmare for the victim, especially as the Internal Revenue Service (“IRS”) will not accept the valid later return if an earlier fraudulent return has been received. This tax-related identity theft issue is so significant that last week, one popular provider of online tax preparation software temporarily halted the electronic filing of all state tax returns while it dealt with an influx of fraudulent state tax return filings.
The IRS is aware of the problem, and has been taking steps to try to address it. One of these steps was just announced. It is a new program that offers an extra layer of fraud protection to residents of Florida, Georgia and the District of Columbia - areas that have some of the highest levels of tax-related fraud. If you filed your last federal tax return as a Florida resident, you can participate in this special program. You do so by going to the IRS website at http://www.irs.gov/Individuals/Get-An-Identity-Protection-PIN and applying for an identity protection personal identification number. Once obtained, this number must be included on your future federal tax returns. If any return is filed without this number, the IRS will not accept it. More simply, this number will prevent an identity thief from successfully submitting a tax return to the IRS, even if the thief has your social security number. It is a short and easy step that residents of Florida can take now to avoid being a victim of tax-related identity theft in the future.
If, unfortunately, you are already the victim of tax-related identity theft, you should, in addition to contacting a tax advisor, submit Form 14039 with the IRS. This form can be found at http://www.irs.gov/pub/irs-pdf/f14039.pdf.
