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5 steps for avoiding identity theft during the tax season

March 14, 2011

| Money Rates Columnist

As if tax season wasn't stressful enough, it's also the time of year when you are most vulnerable to identity thieves. During tax season, you're more likely to have tax documents lying around your house or on the back seat of your car, for instance. Many of those documents not only have your Social Security number on them, but some may also include checking account statements and routing numbers.

Tax season is also the time of year that you're most likely to find out that you have become a victim of identity theft, such as when you get a mysterious W-2 form in the mail from a restaurant chain in Austin, Texas, saying that you worked there last year. Only you live in Minnesota. And you've never been to Texas, let alone Austin.

Identity thieves aren't interested in your name so much as your Social Security number, which they can use to get work or open up a checking account or apply for credit cards. If you start getting turned down on credit applications or getting calls from creditors asking you to make a payment on bills you've never heard of, it's possible that your identity has been stolen.

Precautions to take

Even if you think you've been pretty safe with your financial information, here are five key steps you can take to protect yourself:

  1. Check your annual Social Security statement. Many are mailed in January or February, so look at your benefits and earnings to see if there are any unexpected increases.
  2. Don't give out your Social Security number over the phone or through the mail or e-mail. Tax season is a popular time for scammers to send e-mails out purporting to be from the IRS. The IRS never does that, so if you get an e-mail from the IRS about an unexpected tax refund or containing the threat of an e-audit, report it to the IRS (phishing@irs.gov).
  3. Collect your mail every day, and as soon after it's delivered as possible. Never leave important documents that have your Social Security number of them--such as a tax return--in your mailbox to be picked up. Take it to the post office and mail it directly.
  4. Shred any documents that you no longer need that might have your Social Security number on it. If you're preparing your taxes electronically, go back after filing and delete your name, address, date of birth and Social Security number from any electronic copies.
  5. If you're an e-filer, make sure your computer is protected with an operational firewall and spyware protection.


Good housekeeping habits may save you

It's also a good idea to periodically examine your free credit reports from all three bureaus--Equifax, Experian and TransUnion--and look for weird addresses, credit card accounts or checking accounts that you never opened.

Another good idea: Do a search on your computer for your Social Security number and transfer all the documents you find onto a thumb drive or CD and safely store it with your valuable papers.

Don't save your password on your Web browser when you're going to such important websites as your online checking account or benefits websites. If you keep a password list on your computer, password protect it and never make it available on your smart phone, which can be lost.

Steps to take if stolen

If you learn that someone is using your Social Security number, you must immediately file a police report and a complaint with the Federal Trade Commission.

It's also important to contact the Social Security Administration and the three major credit-reporting bureaus. You can place fraud alerts on your credit reports so banks and retailers will use extra precautions before granting new credit in your name.

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