"It all started one fateful day when an identity thief used my name, Social Security number, and birth date to file a fraudulent tax return, netting the fraudster a $4,000 refund. While it was an excellent payday for the thief, it was the start of some major headaches for me." - AICPA-CIMA
Stories like this are becoming more common as scammers continue to evolve and exploit loopholes in the system.
Luckily, if you're in the US, there is a simple step you can take to exponentially reduce the chances that someone will file a fraudulent return in your name.
It's called the IRS Identity Protection Pin, and the IRS released the program to the general public in 2020.
How the Identity Protection Pin works
- You opt into the program. Sign-up can be done online, by mail, or in person at Local IRS Tax Assistance Center.
- You are issued a PIN
- You supply your PIN when you file your taxes
- PINs are good for one year, and you are issued a new pin each year.
Getting a PIN online is effortless if you already have your ID.ME setup. Before you opt-in, it's good to keep these things in mind:
- There is no going back - "Once an individual is enrolled in the IP PIN program, there's no way to opt-out." - IRS.gov
- If you enable the PIN and don't include it, the IRS will reject your return.
- Store your IP PIN somewhere safe, like your Password Manager.
- Giving your IP PIN to your tax professional is okay so they can include it on your return, but don't share it with others.
Here's a bit of info the IRS provides you with upon receiving your PIN:
Where to Get Your IRS IP PIN
- You can get your IP PIN from the IRS here.
- You can find more info about Identity Protection PINS here.
Getting your IRS IP PIN is an easy way to reduce the risk of someone filing a fraudulent return in your name. It only takes a few minutes and is painless to supply your IP PIN when you file your return.