Your Financial Future: You are the first line of defense against identity theft
We are in the middle of tax filing season. At this time, the IRS does not intend to move the filing date further out than April 15th. If you are not done on that date, you can file for an automatic extension for six months until Oct. 15.
Even if you file this form, you must pay any estimated taxes due or face a penalty.
Identity theft scams are always a problem, but they may happen even more often during tax filing season. Today, we will discuss several of the most prevalent scams. The IRS identified $2.3 billion in tax fraud last year. A lot of this comes from online schemes. This year tax preparers are asking if you received both stimulus checks in 2020. While this money is tax free, your tax return will be the way you claim checks you did not receive.
Filing your income tax return early might protect your tax refund. When your return is e-filed, the IRS computer immediately checks to see if any Social Security numbers have already been used on another return. If so, it flags your return as a duplicate. You will then have to send in your return by mail and submit the IRS identity theft affidavit. This will slow down your refund. This sometimes becomes a problem in child custody cases where both parents are claiming the same dependent. The second return is rejected immediately when it is put in the system.
There are often more phishing attacks around tax preparation time. These are phony e-mails trying to steal your private information. They may offer you a chance to see when your refund will arrive or some other fake information. Look for email addresses that come from hot.mail or g-mail accounts. These are not official and are often used by scammers. The IRS will not communicate with you by email 鈥� only snail mail. They usually don鈥檛 call you on the telephone and will never ask you to pay with gift cards. The police do not come and arrest you for an overdue tax bill. If you see these types of pressure, delete immediately and do not click on links.
Crooks use fake websites that look very realistic. Never enter your Social Security number online. Watch for misspellings and domains other than typical .com and gov. Instead of clicking on a link in an email, type the URL directly into the address bar of your browser.
Many scammers use information they gather from your social media posting. They find nuggets of information like birthdays, children and pet names and use this information to guess commonly used passwords. Some people post way too much information, like when they are away on vacation or out of the house. This information is sometimes used by crooks to break into homes.
Always be careful when throwing out the garbage, too. Things you toss out in the trash, an old driver蘑菇视频 license or credit card for example, can expose personal information. Sometimes things like airline boarding passes contain private information. Buy a shredding machine and use it to protect this sensitive information. Unfortunately, crooks are everywhere and they want to profit off of your mistakes.
You are the first line of defense against identity theft. If something does not look right ask a family member or someone else you trust how you should handle the situation. It is better to be careful than sorry.
Your Financial Future is written by certified financial planner Gary W. Boatman, MBA and CFP, who also wrote the book, 鈥淵our Financial Compass: Safe Passage Through The Turbulent Waters of Taxes, Income Planning and Market Volatility.鈥� If there is an area that you would like to see discussed in the column, send your suggestions to gary@BoatmanWealthManagement.com.