Identity theft is one of the fastest-growing crimes in the U.S. Most people have heard about identity thieves who target credit card companies, banks and other financial institutions. However, identity theft can also be used to acquire utilities, insurance, employment, rental agreements, health and welfare benefits, tax refunds, and to divert arrest warrants for criminal activities onto another person.
Identity thieves use a variety of schemes to steal identities: theft of a purse or wallet, raiding mailboxes or trash bins, phone calls and email solicitations, hacking personal information databases, and many others.
Tax identity thieves tend to target populations that have no tax return filing requirements, such as the elderly, children under 18, and deceased taxpayers, but no segment of the population is immune.
The Idaho State Tax Commission is committed to identifying and stopping tax identity theft wherever possible, and to helping victims to safely file their tax returns and receive the refunds they are entitled to.
- Form 14039 IRS Identity Theft Affidavit
- IRS Publication 4535 Identity Theft Prevention and Victim Assistance
- IRS Publication 4524 Security Awareness and Identity Theft
- Boise Police Department, Identity Theft: A Guide to Protecting Your Identity
- Boise Police Department, Identity Theft Prevention video
- Idaho Coalition Against Identity Theft (ICAIT) website and Facebook page
- Power of Attorney
Identity theft – refund fraud
The most common form of tax-related identity theft involves thieves using stolen Social Security Numbers (SSNs) to file forged tax returns and get refunds early in the filing season. The legitimate SSN owner usually is unaware of the theft until he or she tries to electronically file (e-file) a return and the IRS discovers two returns filed using the same SSN.
The victims of identity theft should complete and mail a paper copy of their income tax return as soon as possible, in addition to following the steps in Reporting Tax Identity Theft. Taxpayers must still file a correct income tax return, even in a case of identity theft.
Some identity thieves only file false federal tax returns. Others file tax returns in multiple states for each stolen SSN. If you suspect that your state tax returns have been compromised, follow the steps in Reporting Tax Identity Theft. Idaho is part of a multi-state network that shares identity theft reports among participating states in an effort to reduce tax identity theft, but not all states are part of this network.
Dependent identity theft
Identity thieves falsely claim dependents on a tax return when no legal or valid relationship exists.
Dependent identity theft used to occur only with federal income tax returns, due to refundable tax credits like the Earned Income Credit and Additional Child Tax Credit. However, due to changes in tax laws, dependent identity theft is becoming a bigger problem at the state level.
Employment identity theft
Identity thieves sometimes use an illegally acquired SSN to get a job. They might use the SSN with their own name, or they might use the true owner’s name instead.
Employers must report wages paid to employees to the Idaho Department of Labor and the Social Security Administration using a Social Security number. This SSN is also included on all W-2 and 1099 forms sent to the IRS and the Idaho State Tax Commission. The result is that the income earned by the identity thief is often pooled with the income of the SSN’s rightful owner.
Employment identity theft may fly under the radar for years without anyone noticing. Often the first indication that employment identity theft has occurred is when the IRS and/or the Tax Commission sends a bill to the rightful owner of the SSN for taxes on the additional income.
If you receive a notice for unpaid taxes on income you didn't earn, from a company that you didn’t work for, or from a state you’ve never lived or worked in, contact the Tax Commission as soon as possible. (See Reporting Tax Identity Theft.)
- If you’re a victim of identity theft and are concerned about your taxes being affected, contact the Idaho State Tax Commission and the IRS as soon as possible:
- Idaho State Tax Commission, (208) 334-7660 in the Boise area or toll free at (800) 972-7660, ext. 7604, Mon.-Fri. 8 a.m. to 5 p.m.
- IRS Identity Protection Specialized Unit (IPSU), toll free (800) 908-4490, Mon.-Fri. 7 a.m. to 7 p.m.
- Complete IRS form 14039 - Identity Theft Affidavit. Mail a copy of the completed form to the address provided and another to the Idaho State Tax Commission, P.O. Box 36, Boise, ID 83722-0410. KEEP a copy for your records.
- There are other agencies you’ll need to report identity theft to, if you haven’t already done so. (See What do I do next? )
When the Tax Commission suspects or receives a report of identity theft, our first step is to freeze the account and stop any refunds from processing until the case can be investigated. Unfortunately, this will also delay a valid refund.
If you think your refund has been delayed longer than expected, call Taxpayer Services at (208) 334-7660 or toll free at (800) 972-7660 to check on it.
The Tax Commission will analyze all of its identity theft reports to look for trends and patterns. Our goal is to prevent similar attempts to steal state refund money using stolen identities.
The IRS has a process that allows victims of identity theft to continue efiling their federal tax returns using a special number that changes each year. However, Idaho uses a different process. You will need to file paper tax returns for at least three years following your identity theft report.
Paper returns are automatically forwarded to an auditor for validation. Attaching a copy of your IRS form 14039 - Identity Theft Affidavit to your return will help the Tax Commission rapidly confirm its authenticity.
- File a police report. The Tax Commission can’t do this for you, nor can we provide information directly to law enforcement officials.
- Contact the Federal Trade Commission (FTC) to file an FTC Affidavit of Identity Theft. You’ll need to attach a copy of this affidavit to any letters you send to companies with whom you’re disputing charges, as well as to the three credit reporting agencies to dispute any items on your credit report. You’ll also need to provide a copy to law enforcement to attach to the police report.
- Check your credit reports for unauthorized activity using www.annualcreditreport.com. By law, you’re entitled to check each of the three credit reporting agencies (Equifax, Experian, and TransUnion) once a year at no charge. Each time you suffer an identity theft incident, you’re entitled to an additional free credit report, but you’ll need to provide a police report for each incident.
- Your financial institution and other creditors. You should close any accounts that have been tampered with. Your bank can help you open new accounts.
- The Social Security Administration or call toll free (800) 772-1213.
- The Better Business Bureau, especially if your identity was compromised through some type of scam.
- The Attorney General’s Office. Select Victim Assistance on the website.
- Confidentiality 63-3076
- Information Exchange Agreements 63-3076(A)