5 Simple Steps To Avoid Tax Return Fraud

Tax time worries are the same every year: finding the right paperwork, meeting the deadline. But there’s a troubling threat to tax returns that you should keep in mind.

It’s a form of fraud where identity thieves obtain your personal information, file a phony return, then pocket your tax refund. And it happens more than you might think. In fact, for the 2020 filing season, the Internal Revenue Service caught 30,038 fraudulent returns—a 751% increase, according to the Treasury Inspector General for the Tax Administration.

Criminals don’t need much to steal your identity, explains Tiara Epps, a resolution specialist from Generali Global Assistance, which works with GEICO and offers Identity Protection. Thieves can lift your date of birth and Social Security number from discarded documents or by hacking your devices, then use that information to file a fake return, usually online. Then they request an electronic refund to be sent to a prepaid debit card, which is almost impossible to trace.

It might take the thief a short time to steal your identity, but it could take you months to correct the injustice and get your refund, Epps says.

To make sure this doesn’t happen to you, adopt these strategies, recommended by identity experts and the IRS:

Guard Your Passwords

If you file your taxes online, keep all your passwords strong and unique—for debit cards, email and online shopping accounts—which thieves may use as gateways to information they can use to file a phony return. If fraudsters learn your passwords, they can also access other information such as your Social Security number, which enables them to file for your refund. (Get tips on creating the perfect password here.)

Watch Your Credit Card Activity

If your card was hacked in the past, you’re more likely to be a victim of tax return fraud, since thieves tend to target big online retailers or healthcare databases, increasing the number of times your information gets exposed and sold. An identity protection plan from GEICO and Generali Global Assistance monitors millions of data points, such as known compromised machines, exploited websites and black market forums, in addition to watching the three major credit bureaus for signs that your personal information is at risk. This service also sends an alert so that you can take action to prevent further damage.

Upgrade Your Firewalls

Don’t underestimate the value of firewalls, antivirus software and other security safety nets. Update these tools and occasionally change your passwords for online accounts.

Follow Your Filing

Once you file your tax return, keep a close eye on its progress by downloading the IRS2Go mobile app, which lets you track your refund status, make a payment or get free tax help. The sooner you see something (for example, that a return was already filed electronically using your Social Security number), the sooner you can say something. You can call the government’s Tax Fraud hotline at 1-800-829-0433, or report suspicious activity at irs.gov.

Prepare To Fight False Claims

If someone does file a tax return in your name, experts at Generali Global Assistance will walk you through the complicated process of restoring your good name, says Michele Krisanda, a senior product manager. They’re available 24 hours a day, and they can help you contact the credit bureaus and freeze your accounts to reduce further opportunities for fraud. A dedicated case manager will also help you get in touch with the IRS or your state-level tax officials and let you know what to expect next, Krisanda adds.

Help keep your identity safe with Identity Protection provided through Generali Global Assistance and secured through the GEICO Insurance Agency. Around-the-clock service helps monitor for fraud and is there to help you if you become a victim.

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