A couple of years ago I jumped on the bandwagon and e-filed my first ever tax return.
A couple of weeks later I was an identity theft victim.
I can’t prove the connection … I also can’t shake the suspicion.
Now, crooks have a new online hack: filing online returns that claim other folks refunds.
I good friend just got burned on this specific new tax hack.
Here’s what’s going on …
According to NBC News …
Cyber hackers steal stolen user names and passwords to the accounts of people who use online tax preparation software.
“Armed with this stolen information — Social Security number, date of birth, dependents, employer and adjusted gross income — the thieves can file bogus state and federal income tax returns. If they can file before you do and their fake return makes it through the system, they can steal a sizeable refund.”
Online tax preparation software makes it easy for crooks to create a fake return. Having the refund deposited to a prepaid card provides a low-risk way to access the stolen money.
The crooks gain access to past returns stored on tax preparation software.
Using information from a real return to create a false one improves the odds that it will evade detection.
The vulnerability of online tax preparation services became apparent when the Utah and Minnesota Departments of Revenue identified thousands of potentially fraudulent returns.
The returns had been filed using TurboTax.
Intuit insists its systems were not breached.
The company suggests that victims had their TurboTax login information stolen from “other sources outside the tax preparation process,” possibly through a phishing scam or some other online attack.
Nonetheless, Intuit beefed-up verification measures, such as multi-factor authentication, a technology that has proven effective at preventing identity theft.
Hmmm. Gone, barn door closed.
What happens if a crook snags your refund?
Well, the burden is on you to prove to the IRS that your identity has been stolen.
Then, in a couple of months (or years) the IRS might cut you a refund check
My advice: file early and beat the crooks to the punch …