Identity theft shows up on people’s taxes, usually, in one of two ways: either as refund theft or employment theft.
If you think you have been a victim of tax-related identity theft, it can be a hassle to sort matters out with the IRS, Comptroller of Maryland, or other government agencies. Maryland tax attorney Jim Liang can help you through each step of the process.
Signs You Have Been a Victim of Tax-Related Identity Theft
Three of the most common signs you have been a victim of tax-related identity theft are:
1. Your electronically filed tax return was rejected by the IRS or Comptroller of Maryland because they have already received a tax return using your Social Security Number (SSN).
2. You start receiving notices from the IRS or Comptroller of Maryland that may not make a lot of sense, for example, the notices may indicate:
- The IRS or Comptroller of Maryland has received more than one tax return from you, even though you have only filed one tax return,
- A refund offset, although you do not owe any money to other agencies, or
- Unreported wages from an employer where you never worked.
3. You start receiving notices from the IRS or Comptroller of Maryland regarding your tax return for a year that you neither filed a tax return nor received a refund.
Although there can be other explanations, these are the most common signs you have been a victim of tax-related identity theft.
Types of Tax-Related Identity Theft
There are two types of tax-related identity theft: refund theft and employment theft. Tax-related identity theft can occur on the federal level with the IRS, the state level with the Comptroller of Maryland, or both.
Tax Refund Theft
Refund theft occurs when someone steals your identity and uses your SSN to file your taxes before you file them. In most cases, the thieves collect the refund in your name and disappear. Most taxpayers do not even realize their identity has been used to file a false tax return until they file their tax return. Typically, the IRS or Comptroller of Maryland rejects the second tax return filed because they already have a completed tax return on file using your SSN. When the thieves have been the first ones to file a tax return and collect the refund, this punishes the victim even further with a long process that can take several months in order for the IRS or Comptroller of Maryland to send the rightful taxpayer their refund.
Employment theft occurs when someone steals your identity and uses your SSN to procure employment. If their employer reports the income to the IRS under your SSN, when you file your tax return it will look like you underreported your income. Just like with refund theft, most taxpayers do not realize there is a problem until they have filed their return and received a notice from the IRS or Comptroller of Maryland.
How To Fight Tax-Related Identity Theft
Jim will help you fight tax-related identity theft involving employment theft or refund theft by doing the following:
Jim will investigate thoroughly your tax situation to determine the extent and type of tax-related identity theft that has occurred, the procedural history of each affected year, and what remedies are available. This includes getting copies of your record of account and wage and income transcripts. He will review them for any fraudulent activity.
Jim will gather information from you to prove to the satisfaction of the tax authorities that you are the rightful owner of the SSN and that you were the victim of identity theft.
Contact the Tax Authorities
In the event of refund theft, Jim will contact the correct tax authorities to establish that you are the rightful owner of the refund. In the event of employment theft, Jim will contact the correct tax authorities to convince them that the unreported income is not yours. To the extent your funds have been taken to pay debts that are not yours, Jim will take steps to get those funds back, if possible.
Contact Taxpayer Advocate Services (TAS)
If you are experiencing a genuine hardship as a result of the identity theft and the IRS is not responsive enough, Jim will contact TAS to get them involved. TAS is an independent organization within the IRS, and their job is to ensure taxpayers are treated fairly.
If you think you have been a victim of tax-related identity theft, save all of your documents — including notices received, copies of filed tax returns, and any other information received — and contact Jim Liang. Jim will:
✓ Communicate with the IRS or Comptroller of Maryland on your behalf
✓ For victims of tax refund theft, submit an official refund claim
✓ For victims of employment theft, separate employment records from the thief’s
Schedule your free consultation with Jim today.