We are just at the start of the income tax identity theft season; income tax identity thieves file early (and often) in order to get their fraudulent income tax returns to the IRS before the victim files his own legitimate income tax return. The theory behind income tax identity theft is simple and effective. The identity thief steals someone’s Social Security number and then files a phony income tax return using that Social Security number with phony W-2s or 1099s that can fool the IRS into sending a large, fraudulent refund. It doesn’t help matters that the IRS still does not match the legitimate W-2s and 1099s sent by employers with those filed by tax filers until late in the summer, long after theirs has sent refunds, but that is another story.
Tarrish Tellis was recently convicted of filing fraudulent income tax returns and stealing more than $700,000 from the IRS through fraudulent refunds obtained as a result of the phony tax returns. Tellis obtained the Social Security numbers and names of 700 victims from an employee of the Alabama Medicaid State Agency. Tellis is scheduled for sentencing on April 15th.
The two best things you can do to protect yourself from income tax identity theft are to keep your Social Security number as safe, secure and private as possible and file your income tax return as early as possible to beat the identity thief to the punch. As shown by the fact that the victims in this case became victims through no fault of their own, but due to the criminal acts of an employee of an agency that had access to their personal information, it is once again abundantly clear that we are only as safe as the places that hold our personal information with the worst security.