Having someone else handle your tax return might seem appealing, but it can turn into a nightmare if that individual is actually a fraudster aiming for your refund.
It occurs more frequently than one might imagine. In the previous year, the IRS identified 1.1 million tax returns with refunds totaling $6.3 billion for further examination because of suspected identity theft. Over 12,000 cases were confirmed as of March 2, 2023.
Being in that situation is something nobody desires. Luckily, the IRS has devised a plan that can lower your chances of tax identity theft. Around 6.1 million Americans utilized it in the previous year. Here’s a guide to help you determine if it’s a good fit for you this tax season.
Important Points to Note
- Last year, over 1.1 million tax returns were identified as potential cases of identity theft.
- To prevent this, taxpayers can apply for a complimentary Identity Protection PIN.
- To file a return in your name, a six-digit PIN must be included.
IRS Identity Protection (IP) PIN: Secure Your Taxes
In the fight against tax identity theft, the IRS introduced Identity Protection (IP) PINs. These unique six-digit numbers are required when submitting your tax return, whether online or in print. Filing a return without the code will not be accepted.
Confirmed victims of tax identity theft receive these PINs from the government to prevent future victimization.
However, individuals can obtain an IP PIN at no cost as long as they possess a valid Social Security number or individual taxpayer identification number (ITIN).
It’s not essential. If you haven’t been a victim of tax identity theft before, you can submit your taxes without an IP PIN.
However, it can occur to anyone. Taking this step is important if you want to protect your identity and tax refund from being stolen.
Applying for an IP PIN
One of the easiest methods to obtain an IP PIN is by utilizing the IRS’s online tool.
You will need to respond to some identity verification questions to confirm that the code is being assigned to you and not someone pretending to be you.
You will need to respond to multiple-choice questions regarding details such as your previous addresses and your mortgage provider.
If you encounter any issues with the online tool, you have the option to complete Form 15227 and send it to the IRS via mail.
You also have the option to request in-person identity verification at a nearby Taxpayer Assistance Center.
After your application is accepted, the IRS will provide you with a six-digit IP PIN for your 2023 tax filing.
In the upcoming year, you will need to log in to your account to retrieve your new IP PIN for the 2024 taxes.
At the moment, there is no option available to decline participation in the IP PIN program.
Once you apply for one, you’re committing to taking this extra step with every tax return you file in the future.