According to a report from CNBC, tax-refund theft is expected to “hit a whopping $21 billion.” ID thieves could steal your refund. Cyberscout postulates that “[w]ith more than a billion personal records “out there,” identity theft has become the third certainty in life, right behind death [and taxes].” Tax-refund theft could hit the poor and the lower middle class (who often use tax refunds as emergency savings) the hardest.
Clark Howard recommends that you take these steps to safeguard your information from ID thieves:
- Use a password-protected Wi-Fi connection when filing your taxes. Use a long and complex password — not just for your Wi-Fi but also for any accounts you’re using during the tax-filing process.
- Get your return via direct deposit. If you must receive a return check via mail, have it sent to a locked mailbox.
- Ask your tax preparer to use two-factor authentication to protect your documents and personal information.
- Use an encrypted USB drive to save sensitive tax documents.
- Never give information to anyone who contacts you by phone or online claiming to be from the IRS. The IRS will never contact you this way.
- Monitor your accounts and online identity for any signs that your identity has been stolen. For example, if you see a sudden, unexpected change in your credit scores, it could indicate your identity has been stolen. You can easily get a look at your credit by using our free credit report snapshot, which is updated every 14 days.