Tax Identity Fraud Grows

The IRS has reported an increase in duplicate tax return filing. This increase in attempted tax fraud signals marked growth in identity theft. As identity theft grows more sophisticated, it becomes harder to trace. Tax fraud victims wait longer for resolution and have less chance for restitution.

Tax Fraud and Identity Theft

Filing tax returns isn’t anyone’s favorite thing to do. And we all know that filing twice can only mean trouble. So when two tax return applications show up with the same taxpayer information, the only answer is fraud. Someone has stolen your personal information and attempted to claim your tax return.

Identity theft is the most dreaded of cybercrimes. It happens with much greater frequency than any other online crime. And it almost always ends up in financial losses. Tax identity theft has started to grab the attention of the authorities. It is moving up the ranks as the crime to watch out for.

Cases of tax identity fraud have resulted in losses worth tens of millions of dollars. Just last month, a man was convicted of stealing $12 million through tax refund fraud. The IRS website alone shows staggering amounts stolen by these fraudsters. The answer to preventing yourself from being the next victim lies where identity theft begins.

How Dangerous is identity Theft?

Identity theft used to be low-tech. Most perpetrators got their hands on information by going through stolen mail, garbage, and picking it up from talkative friends and neighbors. Identity theft used to be the least of our concerns as private citizens. But now we have the Internet. It has grown in both reach and speed. And almost everyone takes advantage of it these days. So identity theft has gone high-tech and is a major threat to all individuals.

Identity thieves now operate mostly online. They are capable of scraping a ton of data from traffic streams all at the same time. They use automated software and viruses and other tools that are available to them mostly for free. They no longer have to spend money to make money. This makes them able to move even faster. If you have not taken steps to secure all your online activities, you are at risk of falling victim to an identity thief.

Tax fraud happens when someone gets hold of your identity documents and other personal information. They set up bank accounts and open mail boxes under your name. Then they simply file a tax return using your details and have the check sent to the fake address. It is deposited to the fake bank account and they’ve got you. By the time you receive word from the IRS that your tax return has been filed twice, your money is gone. The IRS will investigate when it suspects identity fraud, but this causes a lot of problems for you. The IRS will delay your refund until they can find out who the fraudster is. That is, if they can find out.

Identity and tax Fraud Prevention

Identity theft is so sophisticated that it is very difficult to trace who did it. Fraudsters hide behind the anonymity of the Internet because they know how. They are able to hide where and when the information was stolen, and all the details of how they manipulated your identity to take your money. What people need to do is learn to be invisible inline, just like they are.

The general public is becoming more aware of the dangers if identity theft. But many still have not taken proper action to secure themselves against it. They best way to beat a sneaky thief is to know how they operate and. This way the ball in in your court.

Computer security is the first step. Most people already use anti-virus software and firewalls. It is important to make sure your anti-virus provider is at the top of its game. And make sure you keep it updated against the latest threats.Make sure your firewall settings are configured to provide maximum protection against malicious software. Be wary as well of clicking on any links that are sent to you. Verify the identity of the sender before you open any links. They could lead you to a webpage where devastating malware will be downloaded to your computer. Report suspicious emails and messages to the organizations they supposedly come from, using the official email address they provide.

Extra data security is always a good idea. Your information is not only accessible on your computer. When you log onto websites to pay for items, settle bills, check account details and transact with banks, you give out your personal information. Anti-virus software cannot help you here. And you cannot rely on the security of those websites. The information you send to those sites is safe only when it gets there While it is travelling to them, it is at risk of being hijacked. If you use a VPN, the encryption of data and traffic is available to you. Encryption makes the data you send unreadable to unauthorized parties.Click here to start learning more about VPN encryption.

Anonymity is the next step. Secure your identity and any trace that leads a thief back to you. VPN services are excellent tools for hiding your true identity online. A VPN gives you an alternate IP address. Your real IP address has information about you and your location. The “fake” IP address will lead nowhere near you.There are many free proxy services that also give you an alternate IP, but these are not secure and easily traceable. You are further secured by the VPN server, which encrypts everything that passes through. The best VPN companies also put great importance on your privacy. Your personal details are secure with them, unlike your ISP who will not keep subscriber information secret.

These practical personal security tips are what stand between you and being the next victim of identity theft and tax fraud. And remember that once a thief has your information, they won’t stop at stealing your tax return. They can get into your credit account and bank savings, and even sign up for a ton of services that you will get the bill for.

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