Did Someone Use Your Social Security Number to File Taxes? Here’s What to Do

Tax season can be a stressful time for many Americans, but beyond the usual headaches of gathering documents and filing returns, there’s potentially an even bigger concern during tax time—identity theft. 

Scammers and cybercriminals can be more active than ever during this tax season, using stolen personal information to file fraudulent tax returns and steal refunds. 

If you’re filing your taxes online this year, be on the lookout for signs of tax identity theft, such as someone using your Social Security number (SSN) to file and claim a tax refund. 

At Morgan & Morgan, we believe in protecting the rights of taxpayers and holding fraudsters accountable. Here’s what you need to know about tax identity theft and how to safeguard yourself from becoming a victim.

What Is Tax Identity Theft? How Does Tax Identity Theft Occur?

Tax identity theft occurs when a scammer uses someone else’s personal information—such as their Social Security number (SSN)—to file a fraudulent tax return and claim a refund. Victims often discover the fraud when they attempt to file their legitimate tax return, only to be informed that one has already been filed in their name.

“Why would someone file taxes with my SSN?” you may be wondering. Someone might file taxes using your Social Security number (SSN) to commit tax identity theft, typically for financial gain. Here’s why criminals do it:

• Fraudulent Refund Claims: Scammers file a fake tax return using your SSN to claim a refund before you do. If the IRS processes their return first, you may be blocked from filing your own.
• Employment Fraud: Someone who is not legally authorized to work in the U.S. might use your SSN to report income, which could later cause tax complications for you.
• Government Benefits Fraud: Stolen SSNs can be used to apply for government assistance, unemployment benefits, or loans, leaving the real owner with financial and legal troubles.
• Synthetic Identity Theft: Criminals may combine your SSN with other false information to create a new identity, which can be used for financial fraud, tax scams, or other illicit activities.

How Does Tax Identity Theft Usually Happen?

Tax identity thieves use several methods to obtain personal data, including:

• Phishing emails and phone scams: Fraudsters impersonate the IRS, banks, or tax preparation companies to trick individuals into revealing sensitive information.
• Data breaches: Large-scale data breaches expose Social Security numbers and financial information to criminals.
• Mail theft: Some criminals steal tax documents from mailboxes, particularly W-2s and 1099s.
• Unsecured Wi-Fi and public networks: Using public Wi-Fi to access financial information makes it easier for hackers to intercept personal data.

How Do I Know if Someone Filed Taxes in My Name?

One way you’ll know if a fraudster has filed a false tax return using your SSN is if the IRS rejects your tax return once you file. 

The IRS warns taxpayers to watch out for these red flags:

• Receiving a notice from the IRS stating that more than one return has been filed under your SSN.
• Being informed that you have a balance due, a refund offset, or collections actions for a year when you didn’t file.
• IRS records indicating wages or income from an employer you’ve never worked for.
• Receiving an IRS notification about an online account being created in your name without your knowledge.

How Do I Check if Someone Is Using My Identity? How Can I Check if My SSN Is Being Used?

If you suspect someone is using your identity or SSN, you can take several steps to check for fraudulent activity.

Monitor IRS Correspondence

If you receive an IRS notice stating that more than one tax return was filed using your SSN, this is a red flag. If the IRS informs you of unreported income from an employer you don’t recognize, someone may be using your SSN for employment.

Check Your IRS Account

Create or log in to your account at IRS.gov to review your tax records. Look for any suspicious filings or activity related to your SSN.

Request a Tax Transcript

You can request a tax transcript from the IRS to see what has been filed under your SSN.

See if Your SSN Has Been Used Elsewhere

You can check if your SSN is being used elsewhere by taking the following actions:

Check Your Credit Reports:

• Request free annual credit reports from the three major credit bureaus:
  • AnnualCreditReport.com
• Look for accounts or inquiries you don’t recognize.

Monitor Your Social Security Earnings Record:

• Log in to your My Social Security account at SSA.gov to review your earnings.
• If there are earnings from unknown employers, someone may be using your SSN.

Use Identity Monitoring Services:

Services like LifeLock, Experian, or Equifax offer alerts for suspicious use of your SSN.

Watch for Unexpected Bills or Debt Collection Notices:

Receiving bills or debt notices for accounts you never opened can indicate identity theft.

What to Do If You’re a Victim of Tax Identity Theft

If you suspect tax identity theft, take immediate action:

• Report it to the IRS: Fill out IRS Form 14039, Identity Theft Affidavit, and follow their instructions for resolving the issue.
• Monitor your accounts: Check your bank accounts, credit reports, and other financial statements for any unauthorized activity.
• File a police report: While the IRS doesn’t require one, a police report can help establish your claim of identity theft.
• Place a fraud alert on your credit file: Contact the three major credit bureaus—Experian, Equifax, and TransUnion—to add a fraud alert to your file.
• Seek legal help: If you’ve suffered financial losses or need assistance navigating the process, an experienced attorney can help you take legal action.

How to Protect Yourself From Tax Identity Theft

If you use tax preparation software like TurboTax, H&R Block, TaxAct, or TaxSlayer, protect your accounts by using two-factor authentication. Requiring two or more credentials to log in makes it harder for scammers to get into your account, even if they get your username and password. 

And always file early, if you can—before anyone else files using your personal information.

If the IRS says there’s more than one tax return filed in your name or they see income from an employer you know you don’t work for, that’s identity theft.  It’s important that you  act quickly to communicate with the IRS. 

• Report it to IdentityTheft.gov using as many details as possible. The site will create an FTC Identity Theft Report, an IRS Identity Theft Affidavit, and a personal recovery plan.
• Submit your IRS Identity Theft Affidavit through IdentityTheft.gov. This tells the IRS to begin investigating your case. Or get the Identity Theft Affidavit (IRS Form 14039) and submit it by mail.
• Follow the steps in your personal recovery plan—like freezing your credit and checking your credit reports—to limit the damage identity theft causes.

How Much Does It Cost to Change Your Social Security Number?

Changing your Social Security number (SSN) is free if you meet the eligibility requirements set by the Social Security Administration (SSA). However, the process is strict, and the SSA only allows changes in specific situations, such as:

• Identity theft that causes ongoing harm (someone is using your SSN to commit fraud, and you can't stop the misuse).
• Severe harassment, abuse, or life-threatening situations (being a victim of domestic violence or witness protection cases).
• Duplicate SSNs issued at birth (a rare administrative error).

Fight Against Tax Identity Theft: Protect Your Money With Morgan & Morgan

Recovering from tax identity theft can be frustrating and time-consuming, but you don’t have to go through it alone. At Morgan & Morgan, we’re dedicated to helping victims of fraud and identity theft fight back against those responsible.

If you or someone you know has been affected by this issue, or any privacy issue for that matter, our data privacy attorneys are here to help. 

Hiring one of our lawyers is easy, and you can get started in minutes with a free case evaluation.