What To Do if You’re a Victim of Identity Theft Tax Fraud

What to do if you are a victim of Identity Theft Tax FraudAs you finish your 2012 taxes, consider this scenario: Your accountant tries to submit your return to the IRS…which proceeds to reject it. It turns out your return has already been filed, the tax agency explains. By someone else. Using your Social Security number.

This is what happens when you’re a victim of identity theft tax fraud. Criminals assume your identity so they can steal your tax refund check. “In an epidemic that so far shows no signs of abating, crooks have submitted billions of dollars in fraudulent refund claims to the Internal Revenue Service using the stolen names and Social Security numbers of more than a million real people,” explains Forbes.

And the number of these cases is skyrocketing. The IRS received more than 34,000 tax identity theft cases in fiscal year 2011 – a 97 percent increase over 2010, according to ABC News. And all that an ID thief needs to become “you” is your name and Social Security number, according to Credit.com.

According to the IRS, you may be a tax identity theft victim if the agency sends you a letter stating:

  • More than one tax return was filed under your identity.
  • You have a balance due, refund offset or have had collection actions taken against you for a year in which you did not file a tax return.
  • IRS records indicate you received wages from an employer unknown to you.

If you do receive such a letter from the IRS, the agency urges you to “respond immediately.” After reaching someone at the Service, the IRS site says, you’ll need to fill out an Identity Theft Affidavit form.

Beyond that, you’ll want to make sure your identity theft hasn’t spread beyond your tax return. The Federal Trade Commission recommends taking the following steps:

  • Place a fraud alert: Contact one of the three credit reporting companies – Equifax, Experian or TransUnion — and report that you’re an identity theft victim. Ask the company to put a fraud alert on your credit file. Then confirm that the credit bureau you’ve called will alert the other two.
  • Ask for your credit report: Having placed a fraud alert on your credit report entitles you to a free credit report from each of the three credit bureaus. When you receive them, examine them for suspicious activity. If you find any, contact the related businesses.
  • Create an identity theft report: Contact the FTC (877-438-4338 or 866-653-4261). Write up a report about your identity theft and submit it to the FTC (you’ll also need to fill out a complaint form). Like the form you filled out for the IRS, it too will be called an Identity Theft Affidavit. Print out the Affidavit, take it to the police, and file a police report. Your Affidavit, combined with the police report, will comprise your Identity Theft Report. The Identity Theft Report will help you get fraudulent information removed from your credit report and stop companies from collecting debts resulting from identity theft.

After taking these initial steps, the FTC also offers recommendations on follow-up actions you can take if necessary.

Have you, or has anyone you know, been the victim of identity theft tax fraud? How was the problem handled?

External Link Image Label Links to non-Ally websites

We provide links to third-party websites for your convenience. Although we provide a link, Ally Financial is not responsible, nor can we guarantee their products, services, or information. We suggest you review their online policy and security practices to learn about this third party and how they handle consumer information.


  1. 1

    Yes, this happened to me this year. Although I found out out about it not because my return was reject, but because I received a refund check in the mail. I knew I hadn’t yet filed my 2012 taxes, so I called my accountant and then the IRS. I did not fill out a form with the FTC, though. No one had advised me to do that and I didn’t need it to file a police report, I just showed them the check made out to me and some stranger.

    I have no idea how someone got my SSN, since I am very, very careful with it. Unfortunately, I must file my return by mail this year, have it manually processed, and wait up to six months for a refund check now. :-(

  2. 3

    My husband’s ssn was stolen and used on another refund form, so we had to fill out a bunch of forms, send it all by mail and wait. And wait, and wait, and wait. We sent in everything and the irs showed they received it on April 4th.. It’s almost July and we’ve still heard nothing. I doubt they’ve even touched it yet! I’ve called them several times, only to be on hold for an hour, and then get disconnected due to “technical difficulties.” Yea, right. I’m so frustrated!

  3. 5

    I was a victim they filed taxes with my ssn my forms got rejected and it was a nightmare took me over a year to clear this up so watch ur ssn

  4. 6

    Same boat, I received a letter last year stating that a lady’s name and myself cannot get our refunds at this time. I’m like who the heck is this person on the letter? So I called my CPA and she told me my identity was stolen. WOW, what a bad day;(! A year ago it happened and I did get confirmation from the IRS that it was fraud and even received a document stating how much interest I earned, but I’m still waiting for my refund! If it does happen to you, file the correct paperwork to the IRS ASAP! Then call all credit agencies, then call Lifelock, or be as careful as you can with your information!

  5. 7

    I originally filed February 20, 2014. After doing so I waited about two weeks, and still didn’t hear anything back, from the IRS. Finally I was contacted by the company in which I filed with, and they informed me that I was rejected, because it showed up in the IRS system, that i’ve filed recently. Which was impossible because I hadn’t filed all year up until that point. My tax preparer informed me that I needed to mail a paper return in, I did the exact same day. I even put a tracking number on the envelope, so i’d know when it made it to Austin Texas. A month passed and I was able to track it online, at “where’s my refund.” but after a while, the orange bar went away, and I could see anything. then from their it told me that they’ll have a refund date for me whenever one becomes available…now i’m being told 180days… and when I checked today, it’s saying that theirs nothing on file for me for 2014? what’s going on???

Leave a Comment