Looks like we’ve become victims of identity theft. I filed our taxes electronically via TurboTax, but they were rejected because a return has already been accepted from the IRS for our SSN. Luckily, we owed money, so it should eventually be straightened out without much harm to us.
Friends of ours had a similar thing happen on Monday, which prompted me to file earlier than I would have. Sadly, they are due a refund. They were told that they won’t be getting their refund for 6 months or a year because they’ll have to go through the process of filing an affidavit saying that they were victims of identity theft and then proving that they are the legitimate filers.
We are both Anthem subscribers and believe it’s related to the Anthem security breach. Luckily, our two daughters were able to e-file without incident.
Tried to call the 800 number to see what was up, but was never able to get through to talk to a human. The robocaller had two options: 1) Press “1” if you’re calling regarding your refund; 2) Press “2” if you’re calling about your amended taxes.
There’s not even an option to press if you owe money.
I also tried calling the IRS Fraud hotline, but they said that they cannot process my call because of overwhelming call volume. The website instructs me to go ahead and file via paper and I’ll eventually be contacted by the IRS.
I’ve known folks who got their credit ransacked. I’ve known people who had their bank accounts rifled. But this is the first I’ve heard of folks having their TAXES filed for them…
I don’t know why the difficulty of dealing with the IRS, need for urgency on most matters and penalties that pile up for failing even when it’s their fault makes me think of this.
Last year, the Seattle Archdiocese had a major data loss that resulted in a lot of these identity theft/tax fraud filing.
I still point people to their list of steps to follow when it affects you because it covers the IRS as well as steps that should be taken with other agencies.
When you file your taxes by mail, don’t forget the form 14039 Identity Theft Affadavit.
And since you owe money on your taxes, my recommendation is to make the payment by April 15th, just to make sure that no interest or penalties are applied to you even after this gets sorted out. The IRS typically sees filing of tax and payment of tax as two separate issues, and even if they might waive penalties for late payment, they are unable to waive interest.
How is it possible that someone could file taxes in your place?
I’m not familiar with the US system, living in Canada. Here, the tax folks send you an access code each year, in the mail. You need that code to e-file. If I have received the code then I don’t see how anyone else could file in my name. And, if I’ve not received the code in the mail come tax time, I couldn’t e-file and that would be a red flag for me: has someone swiped the code out of my mail-box?
I just don’t see how someone else could e-file and you could also try to e-file??
ETA: meant to add: sorry to hear about this; sounds scary.
There is no access code, just your SSN. You can use your SSN to get a copy of your W-2. File someone else’s taxes with their SSN and their W-2, claim their refund, hightail it out before anyone notices you’ve taken someone else’s money.
First of all, e-filing is not required in the United States. You may file a paper return instead. No PIN is required for paper filing. Thieves feel no hesitation to file paper returns. I know that most people imagine that tax thieves are sophisticated cyber-criminals sitting behind computer keyboards pumping out millions of e-filed returns, but for most thieves, the tried-and-true old-fashioned methods work best.
Now, the IRS does have an Identity Protection PIN program for some tax payers. Taxpayers who have had problems with identity theft in previous years are sent a 6-digit IP PIN in the mail, although anyone can request one. For those taxpayers, the IP PIN is required in order to e-file. Refunds for paper returns will be delayed if the IP PIN is not provided.
Incidentally, the 6-digit IP PIN causes some confusion because when you e-file a return, the IRS asks you to select a completely useless 5-digit “signature PIN” that serves no function whatsoever. People confuse this with the 6-digit IP PIN.
Also, in the US, it is impossible for an individual taxpayer to e-file directly with the IRS. They must go through a private authorized e-file provider. Yes, most people think that when they use TurboTax at home and hit the “file” button that the information goes straight to the IRS. It first goes to Intuit, an authorized e-file provider who keeps a copy and then e-files it with the IRS. If you happen to know a crooked e-file provider, they can help you e-file your fake tax returns without PINs or AGIs.
What most honest taxpayers don’t realize, but all tax thieves know, is that the IRS does not have a copy of your W-2 this early in the year. In order to get a copy of your W-2 this time of year, the thief would have to know who your employer was and convince the employer to give the thief a copy. It’s much easier to just print up your own. It’s much more lucrative, too, since you can make up your own numbers so that they maximize the refund amount.
Both of you, you may enjoy reading this IRS web site page:
Not really, this has been going on for a bit, but this year a bunch of thieves apparently found a way to exploit Turbo tax and this is expected to affect hundreds of thousands, if not millions.
Thanks for the summary of how it works with the IRS. It sounds like a not-very-secure system, if all you need to file is the SSN.
Why can’t there be direct e-file? I don’t understand the policy basis for only allowing the tax software companies to e-file. Seems to me that every added step in the process increases the chances for something to go wrong.
There is also direct e-file. I just submitted ours, in fact. It’s just not as user-friendly to some people as using a private tax prep company’s software.
For an alternate perspective…this happened to us two years ago. It turned out to be a glitch, though I can’t recall if it was a turbotax glitch or an IRS glitch or an interface between the two glitch.
There was a smallish amount of time and energy devoted to fixing the problem, but there was no identity theft and nothing else significant going on. Hope the same proves true for you.
To be clear, the scammers aren’t pocketing legitimate refunds. They’re pocketing bogus refunds that are calculated using completely bogus data. They use legitimate SSN numbers and file completely fake returns, always ensuring that they get a refund. They can make up whatever data they want because the government is in the very bad habit of issuing refunds before cross referencing the data for legitimacy, such as matching income declared with W-2s and 1099s.
Because we have investment income, we are at an even greater disadvantage because we can’t file until mid-March, even if we wanted to file earlier, because the banks aren’t issuing 1099s until then. That is giving the crooks a very nice window of opportunity to make up whatever data they want and beat the real taxpayer to filing.
The only good thing about owing money is that it folks who have legitimate refunds will have to wait until after the investigation is complete before collecting that refund. Since we owe money, we’ll go ahead and write the check on time without further harm to us financially. (Time and aggravation is another matter.) We have no doubt that the IRS will eventually conclude that we are the legitimate filers, because only a really, really bad crook would file a bogus tax statement that had a balance due.
Did you just file a paper copy and wait for them to contact you? I cannot get ahold of anyone at the IRS to know what happened. The only information I have is from TurboTax, which has notified me that the federal e-filing was rejected because the IRS has already accepted a filing with my SSN.
Yes, insurance companies have to provide tax information to the government and to the insured, and SSN is the key for these.
It’s really a Catch 22. Everyone can envision why it’s important to have a unique identifier for a person–helps ensure claims are paid legitimately, tax info is filed accurately, etc. Why not just create a different unique identifier, and then SSN isn’t in play? Well, then the new unique identifier assumes the same character and has the same dangers associated with it. It becomes as personal as the SSN. And think how easy it would be to commit fraud without some “secret” key that lets the other party know it’s truly you.