MARCO EAGLE

ID Alert: Steps to take before tax season

Carrie Kerskie
Columnist

The last quarter of the year is typically focused on the holidays. But it also signifies the wrapping up of another year. This means that tax season is right around the corner.

Instead of waiting until March, now would be great time to begin thinking about protecting your identity before the start of tax season.

Credit reports

Credit: BAaAej Ayjak, Getty Images/iStockphoto

If you have not done so already, request your free credit reports. You are entitled to one free credit report every 12 months from each credit bureau. They are TransUnion, Experian and Equifax.

The easiest way to obtain your free credit reports is by visiting annualcreditreport.com or by calling 877-322-8228.

AnnualCreditReport.com is a website that was developed by the three credit bureaus and the Federal Trade Commission to make it easier for you to get access to your free credit reports.

If you have a credit freeze you will need to call each credit bureau to request your credit report. You will be asked for your PIN number. The PIN number was assigned when you initiated your credit freeze.

After you have reviewed all three of your credit reports, you may want to consider staggering your future requests to once every four months. Just make a note on your calendar to remind you to get your credit report.

SSA statement

Another report to review is your annual social security statement from the Social Security Administration (SSA).

This can be obtained by logging in to your MySSA account. This is an online account that enables you to view and, if applicable, manage your benefits or apply for benefits.

If you have not yet set up your MySSA account you can do so by visiting ssa.gov.

When reviewing the report check the reported income amount. This information is provided by the IRS to the SSA. The reported income is used to determine your future benefits. If the reported income is incorrect, contact the SSA. It could have been a reporting error or it could be red flag for employment identity theft.

Document destruction

Some documents must be kept for specific period of time while others are not.

When you no longer need the documents don’t throw them in the trash. To protect your information, you should shred the documents prior to disposing of them.

The smaller the shred cut the better.

Change passwords

All of us tend to become lazy when it comes to changing our passwords.

Start a new habit of changing your passwords at the end of or the start of each new year. Start with your sensitive accounts such as bank accounts, credit card accounts and anything that could contain sensitive information. The longer the password the better. Think beyond a word. Use a phrase or a song lyric. Get creative. Just don’t use the same one for every account.

Now you need to determine where you are going to keep your new passwords. If you are old-school you can use paper and pen, just make sure you lock it up when not in use. The next step up would be to store them in a spreadsheet or document. Make sure the file is password protected and backed up offline. A step up from here would be a password app or program. A few of these have been breached in the past so do your research before trusting a third-party with your password information.

Beware of IRS and tax related scams

Tax season is the perfect season for scammers. It provides plenty of opportunities for scammers to get between you and your information or your money.

The typical scams include the IRS impersonation phone call. The scammer will call pretending to be from the IRS. He will say you owe money and he will demand immediate payment. While the IRS may call you, they would never demand payment over the phone.

Another scam involves sending you a phishing email that appears to be from the IRS. The email states that there is a problem with your return and that you need to click the link or open the attachment. You should never click on a link or attachment in an unsolicited email.

If you receive an email from the IRS and you are unsure if it is legitimate your best defense is to call the IRS at 800-829-1040. This number can be found by searching for the IRS phone number online.

You should also be careful for potential man-in-the-middle attacks. The IRS has stated that accounting and tax prep companies are prime targets for hackers. Once hacked the hacker can intercept communications between them and their clients. If you should receive an unsolicited email from your accountant or tax preparer, contact them directly to verify the legitimacy of the email.

Email encryption

Another thing to consider when communicating via email with your accountant or tax preparer is that emails are not protected. When the information is in transit, between your computer and your accountant’s computer, it is susceptible to being intercepted. To protect yourself use email encryption when sending sensitive information. You should ask your accountant or tax preparer to use email encryption when sending you sensitive information. Many of them have already begun the transition to encrypted email.

Back-up computers and devices

No one wants to lose important files such as family photos or tax documents. Protect your information by backing up all of your files at the end of the year. You can back them up to a portable external hard-drive or other USB type of device.

It is always a good idea to have two copies of a backup just in case one should fail or become corrupt. Then store the backup in a secure location such as a locked file cabinet or safe, especially if the files contain sensitive information.

File early

Filing your return early is a great way to prevent someone else from doing it on your behalf. This does not apply to filing an extension. Only the return itself.

To help expedite the process begin gathering your tax receipts as soon as possible. If you have any deductibles, such as medical expenses, add up your receipts to have your totals ready. The more organized you are the faster you will be able to file your return. If you are using an accountant or tax preparer make sure you send him or her your information as soon as it is available.

E-file

The final decision is how to file. E-filing is the preferred method as you receive an almost instant confirmation from the IRS that your return has been received.

If you are unable to e-file, for example if the IRS has told you that you must file a paper return, it should be mailed certified mail. By sending it certified you will receive confirmation when the IRS has received your return. It also lessens the risk of your return being stolen during transit as it is being tracked. Criminals have now resorted to fishing for outgoing mail in the big blue United States Postal Service (USPS) mailboxes. They tie a string to a stick and attach a sticky substance to the other end of the string. Now all they do is stick in in the box and fish for mail. Protect yourself by placing your paper return in the outgoing mailbox inside of your local USPS.

By using these tips you will be in a better position to reduce your risk of identity theft.

Carrie Kerskie is a sought-after speaker, trainer and consultant on identity theft and data privacy. She is the author of “Your Public Identity: Because Nothing is Private Anymore.” Kerskie is the director of the Identity Fraud Institute at Hodges University and president of Kerskie Group Inc. You can contact her at 239-435-9111 or ckerskie@hodges.edu. Follow her on Twitter@CarrieKerskie.com.