According to the Internal Revenue Service, 20-25 percent of Americans wait until the last two weeks before the deadline to prepare their returns. And at that late date, there are only two things you can do: File your taxes asap, or request an extension.
There are many reasons why people procrastinate on filing their returns and really there’s nothing wrong with waiting. Maybe you owe money this year and you don’t have the cash to pay it yet. Or maybe you’ve been busy or maybe you just forgot.
Whatever the reason, protecting your identity information is as important as ever. Especially if you’re scrambling at the last minute. Identity theft is an extremely frustrating process for the victims and occurs when someone uses your personal information such as your name, social security number or other identifying information, without your permission, to commit fraud or other crimes.
Be alert to possible identity theft if you receive an IRS notice or letter that states one of the following:
- More than one tax return was filed in for you.
- You have a balance due, refund offset or have had collection actions taken against you for a year you did not file a tax return,
- IRS records indicate you received wages from an employer unknown to you.
Here are 3 tips to avoid Identity Theft this tax season:
1. Choose a safe and reputable tax preparer.
This sounds like a no-brainer, right? But we’ve all heard stories about people that were taken to the cleaners by a ‘safe’ tax preparer. Do your research. Go online and make sure they are a legitimate company.
Do you know about the “You Earned It You Claim It” campaign? The “You Earned it You Claim it” campaign is bringing information about free tax preparation and the Earned Income Tax Credit to Minnesota residents. There are 250 free tax preparation sites across the state that serve families based on income and family size. Taxes are prepared at these sites by IRS-certified volunteers trained to help you maximize your refund. In addition E-file is available and when used with direct deposit you will get your refund quickly. Click HERE to learn more.
2. Protect your valuable documents
I am going to go out on a limb here and say that every single document you use to prepare your tax return as personal information on it. Be safe with it. Start a folder (or a shoebox) and keep all of the information in one place. If you are like me and my husband you will want to keep last years tax return (if not more) for reference. We file them in a cabinet in our office. If you have a document you no longer need please shred it or burn it. Don’t risk your identity by throwing it in the garbage.
If you have to mail anything with confidential information it is best to go to the post office yourself.
3. Be alert to scams
Tax scams happen every year and are going to continue on for many to come. You may receive an email or phone call from someone claiming to represent the IRS or other federal agency. Keep in mind that when it comes to your taxes, only one federal agency is ever involved and that’s the IRS. On its website, the IRS plainly states that it contacts taxpayers via U.S. Post – and never by email, text messages or phone calls. Want more information? Visit the Taxpayers Guide to Identity Theft on the IRS website.
If you have questions about any of this, other financial topics, or just want to create a personalized spending plan, call LSS Financial Counseling at 888-577-2227. To get started on a budget quickly and easily, you can BEGIN ONLINE now. It’s efficient and just as effective as in-person or phone financial counseling. Our Certified Financial Counselors are always here to help!
Author Kate Swenson is a Project Manager at LSS Financial Counseling.