COLUMN: How to avoid ID thieves this tax season

Here are several ways that identity thieves are targeting you, how to protect yourself, common signs of ID theft, and steps to take if you become a victim.

How Identity Thieves Target You

•Impersonating the IRS. Thieves call you and claim to be the IRS. They will try to intimidate you into making an immediate payment using a gift card or wire service. Remember, the IRS will physically mail you a letter as a means of first contact. And the IRS will never call you to demand an immediate payment.

•Filing a fraudulent tax return. Identity thieves try to file a tax return using your Social Security number before you do. So, consider filing your tax return as quickly as you can to beat identity thieves at their own game.

•Phishing schemes. Be on the lookout for unsolicited emails, text messages, and social media posts that prompt you to share personal and financial information. These messages could also contain viruses, spyware, or other malware that could infect your electronic devices.

Common signs of ID theft

Here are some of the common signs of identity theft according to the IRS:

•You receive a refund before filing your 2024 tax return.

•You receive a tax transcript you didn’t request from the IRS.

•You receive notice that someone created an online IRS account without your consent.

•You find out that more than one tax return was filed using your Social Security number.

•You receive tax documents from an employer you do not know.

Other signs of identity theft include:

•Unexplained withdrawals on bank statements.

•Mysterious credit card charges.

•Your credit report shows accounts you didn’t open.

•You are billed for services you didn’t use or receive calls about phantom debts.

What you can do

If you discover that you’re a victim of identity theft, consider taking the following action:

•Notify creditors and banks. Most credit card companies offer protections to cardholders affected by ID theft. You can generally avoid liability for unauthorized charges exceeding $50. But if your ATM or debitcard is stolen, report the theft immediately to avoid dire consequences.

•Place a fraud alert on your credit reports. To avoid long-lasting impact, contact any one of the three major credit reporting agencies—Equifax, Experian or TransUnion—to request a fraud alert. This alert covers all three of your credit files.

•Report the theft to the Federal Trade Commission (FTC). Visit identitytheft.gov or call 877-438-4338. The FTC will provide a recovery plan and offer updates if you set up an account on the website.

One of my primary objectives is to help you achieve your financial goals through a holistic approach that is tax-efficient in my wealth management and tax resolution practice. For more information, visit www.fredtfoxiii.com.