According to the IRS, a record 77 million tax returns were filed electronically in 2007 and these figures are sure to increase in 2008. For an identity thief, tax time is prime time. Tax documents are a gold mine for thieves as they contain social security numbers, names, addresses, bank and other financial information. Over 8 million Americans have their identities stolen each year. The FTC recently reported that in 2007, the #1 category of complaint—32% of total complaints received—was identity theft.
At tax time, perhaps more than any other time, it’s essential to be savvy about how to protect your identity.
Here are some tax-time tips to prevent identity theft, courtesy of Identity Finder:
Password-protect all tax returns that you print to PDF from your tax software so your SSN is secure.
Configure all peer-to-peer file sharing programs to disable the sharing of your personal folders so identity thieves can’t download your tax return.
Don’t email tax documents to your accountant unless they are encrypted to prevent anyone snooping on your network from gaining access to your financial information.
If downloading your IRS W2 forms, 1099s, and other personal tax documents from your employer, make sure you create a strong password when registering to download them so it is not easily guessed by strangers.
If you receive an email purporting to be from the IRS that requires personal information to process your return, rebate, or refund, do not respond to it. The IRS does not contact you via email and this is more likely a phishing attack.
When you postal mail your tax return to the IRS, make sure it is mailed from a secured location like the post office or an official USPS collection box and do not let it sit in the box overnight as it could be stolen. For added security use certified mail.
If you receive an unsolicited phone call from someone claiming to represent the IRS, do not give personal information over the phone. Hang up, and call the IRS directly.
If you owe taxes and pay electronically via the Internet, or are due a refund and elect to obtain it via direct-deposit, make sure that the websites you enter your account information into are secured.
Any unsecured documents containing personal information that you used to prepare your tax return should be permanently shredded from your computer. Any printed documents should be traditionally shredded.
If making photo copies of your financial documents, make sure the photocopier does not store images of them in memory.
Install the latest updates to your operating system so known Windows or Mac vulnerabilities can’t be exploited by hackers.
Don’t save your password in your web browser when accessing banks and other institutions that keep your personal information because it could be leaked if you ever get a virus, Trojan, or are hacked.