Tax season ideal for stealing personal identity

Published: Apr. 5, 2023 at 4:36 PM PDT
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RENO, Nev. (KOLO) - Ask Jackson Hewitt tax preparer Bruce MacKinnon it happens every year. He helps someone with their taxes and then soon after...

“We filed a return for a single gentleman,” says MacKinnon of an incident just last week. “And the return was submitted to the IRS and five minutes later a message comes back that the return been rejected because the name and social security number have already been used this tax season.”

It happens that fast?

“It does indeed,” says MacKinnon.

MacKinnon says considering the sensitive information contained inside a tax return for a fraudster it’s like striking gold.

Not only is personal information contained on the return, but a child’s identity may also be included.

“People claiming children they aren’t entitled to, in order to claim the credits that are associated with dependent children,” says MacKinnon. “Which can, the child tax credit is $2,000 per child; based on family size. That can multiply quickly.” MacKinnon says the tax filer is expecting a return.

But if his and his child’s identity has been stolen including name, social security number, and date of birth--the person who steals that identity instead can rake-in tens of thousands of dollars.

MacKinnon says the person whose identity is stolen is left re-filing by paper and mail. It could take months to clear up the process much less receive the return.

This is why preparers like MacKinnon must have a business license and be certified by the Nevada Secretary of State.

“In Nevada there are two levels of professional identification the person should ask for,” says MacKinnon. “The first is the federal or the IRS issued preparer tax identification number. And that is issued by the IRS to any individual who completes tax returns and is compensated for it. The second that we have here in Nevada is paid preparers are also required to register with the Secretary of State’s Office. It is renewed annually.”

The IRS does offer PIN numbers to tax payers as a way of preventing another person from using a social security number that does not belong to them. MacKinnon says that number is changed every year.

The process takes a bit of computer knowledge and it’s not for everyone. But for those who have become victims of identity theft is it an option. The IRS will never call to request a PIN number, and it should only be shared with a legitimate tax preparer.

It is important you check the credentials and licensure of anyone preparing your taxes. The IRS is warning there are companies who say they are specializing in Employee Retention Credits. It would mean $26,000 dollars per employee. It’s not chicken scratch; and could easily be taken out of your hands if the preparer is not legitimate.