by John Scollin, Shareholder, Business Advisory Group

If you waited to file your tax return until April 15, you may have been shocked to learn the IRS rejected your return because it was already filed. As panic set in you began to wonder how this could have happened and what can be done in order to correct the situation.

If this happens to you, you’re not alone. According to the Federal Trade Commission, 2014 marked the fifth consecutive year tax-related identity theft topped the list of complaints, with more than 100,000 received. In most instances, the identity theft used a Social Security number to file a false return early on in the tax season.

Identity theft can be a frustrating process for victims, especially if your hard-earned refund is being held hostage because of it. Doeren Mayhew offers six steps to help you navigate through reclaiming your tax identity and refund:

  1. Report the fraud as soon as possible. Call the IRS Protection Specialized Unit immediately to begin the process of reporting the fraud. In addition, you will need to file an identity theft affidavit (Form 14039). This will allow the IRS to put an alert on your account. Report the incident to the Federal Trade Commission. You may also want to file a police report. While it is unlikely the police department will take action, credit bureaus may require this report to help resolve the issues stemming from the identity theft.
  2. Have your documents ready. The IRS may ask for additional information to verify your identity. For example, an identity thief would not know you were newly married in 2014 and filed as a single taxpayer prior to that. Have your old tax returns handy, as well as your driver’s license, birth certificate, passport and recent utility bills. The IRS will ask you to mail in these documents in order to determine the other return was fraudulently filed.
  3. Alert the credit bureaus. Contact the three major credit reporting agencies – TransUnion, Equifax and Experian – to set up fraud alerts. These alerts will warn potential lenders you are a victim of identity theft and ensure your identity must be verified before they issue new credit under your name and Social Security number. The alerts last 90 days and can be renewed. You can also put a credit freeze on your account, but doing so will prevent you from obtaining instant credit.
  4. More protection. Once the fraud is reported and affidavit is received, the IRS will issue you a personal identification number (PIN). When filing future tax returns, you will need this PIN along with your Social Security number. You will be issued a new PIN every year.
  5. Verify your credit report. Everyone is entitled to a free credit report from each of the three credit reporting agencies. Review yours annually. Check for any suspicious activity and report any errors or discrepancies immediately.
  6. Update your passwords. There is a good chance this was an isolated incident and the thief is long gone, but just in case, it is always a good idea to change your passwords. Passwords should be changed every 60 to 90 days and should be strengthened by using characters, as well as numbers.

You don’t have to go at the process alone. Contact our Doeren Mayhew’s tax advisors in Michigan, Houston and Ft. Lauderdale to help you reclaim your refund.