When the safety of your Social Security Number (SSN) is compromised, it can feel like your financial life has been turned upside down. Identity theft, particularly tax-related identity theft involving your SSN, is a serious matter that requires immediate and strategic action. The good news is that the IRS has a system in place to help victims and protect them from further harm. This comprehensive guide will walk you through the essential steps to "flag" your Social Security Number with the IRS, which effectively means reporting identity theft and taking measures to safeguard your tax information.
Ready to take back control of your financial identity? Let's dive in!
Step 1: Confirming the Breach and Gathering Evidence
Before you reach out to the IRS, it's crucial to confirm that your SSN has indeed been compromised and to gather any evidence you might have. This will make your report more effective and help the IRS in their investigation.
Signs Your SSN Might Be Compromised
- Unexpected IRS Notices: Did you receive a letter from the IRS about a tax return you didn't file, or a balance due for a year you know you didn't owe? This is a major red flag.
- Rejected E-Filed Tax Return: Your e-filed tax return is rejected because a return with your SSN has already been filed.
- Unusual Activity on Credit Reports: You notice unfamiliar accounts, inquiries, or addresses on your credit reports.
- Denied Benefits: You're denied government benefits because benefits are already being paid using your SSN.
- Unemployment Benefits You Didn't Apply For: You receive notices of unemployment benefits you never applied for.
- Receiving Unknown Forms W-2 or 1099: You get tax documents for income you didn't earn or from employers you've never worked for.
What to Document
- Dates and Times: Note when you first discovered the issue.
- Notices/Letters: Keep all letters or notices you receive from the IRS, banks, credit card companies, or any other entity related to the identity theft.
- Communication Records: Log all calls, including the date, time, who you spoke with, and what was discussed. Keep copies of all emails or written correspondence.
- Suspicious Activity: Detail any specific instances of suspicious activity you've observed, such as fraudulent tax filings, credit applications, or unauthorized purchases.
Step 2: Report to the Federal Trade Commission (FTC)
The FTC's IdentityTheft.gov website is your first and most critical stop when your identity has been stolen. It's a comprehensive resource that helps you create a personalized recovery plan and generates important documents.
How to Use IdentityTheft.gov
- Visit IdentityTheft.gov: Go to the official website: www.identitytheft.gov.
- Start Your Report: Click on "Get Started" and answer a series of questions about the type of identity theft you've experienced. Be as thorough and accurate as possible.
- Receive Your Recovery Plan: Based on your answers, IdentityTheft.gov will generate a customized recovery plan. This plan will include step-by-step instructions for what to do next, which may include contacting specific agencies, placing fraud alerts, or freezing your credit.
- Obtain Your FTC Identity Theft Report: The site will also generate an official FTC Identity Theft Report. This report is incredibly important as it serves as official proof of identity theft and can be used with various agencies, including the IRS and credit bureaus.
Why the FTC Report is Crucial
The FTC Identity Theft Report provides a documented record of your experience. It helps streamline the process with other organizations and often acts as a prerequisite for certain actions, like filing an IRS Identity Theft Affidavit.
Step 3: Notify the IRS and File Form 14039
Once you have your FTC Identity Theft Report, it's time to directly inform the IRS about the fraudulent use of your SSN. This is the primary way to "flag" your account.
Sub-Step 3.1: Contacting the IRS Identity Protection Specialized Unit
If you suspect tax-related identity theft but haven't yet received a notice from the IRS, or if you're looking for specialized assistance, you can call the IRS Identity Protection Specialized Unit.
- IRS Identity Protection Specialized Unit: Call 1-800-908-4490. Be prepared for a potentially long wait time, especially during peak tax season. Have your personal information and any details about the suspected identity theft ready.
Sub-Step 3.2: Completing and Submitting Form 14039, Identity Theft Affidavit
This form is the official way to tell the IRS that your SSN has been misused.
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When to File Form 14039:
- If your e-filed return was rejected because a duplicate return was already filed using your SSN.
- If you receive an IRS notice indicating that you owe additional tax, your refund was offset, or collection actions are being taken for a tax year you didn't file or earn income.
- If you receive a Notice CP01E, Employment Identity Theft.
- If you receive a Form W-2 or 1099 from an employer you did not work for and you haven't received an IRS notice questioning this income.
- Generally, you should NOT file Form 14039 if the IRS sends you a letter like 5071C or 4883C, as these letters initiate their own identity verification process.
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How to Obtain Form 14039:
- You can access a fillable PDF version of Form 14039 directly from the IRS website (search for "Form 14039 IRS").
- Alternatively, when you report identity theft through IdentityTheft.gov, they can help you generate and submit Form 14039 electronically to the IRS. This is often the easiest and most recommended method.
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Filling Out Form 14039:
- Provide all requested personal information accurately.
- Clearly explain how you believe your identity was stolen and how your SSN was misused in the space provided. Be concise but provide enough detail for the IRS to understand the situation.
- Attach any supporting documentation, such as copies of the FTC Identity Theft Report, IRS notices, or police reports (if applicable).
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Submitting Form 14039:
- Online (via IdentityTheft.gov): This is the most efficient way. The FTC will electronically transmit your Form 14039 to the IRS.
- Mail or Fax: If you complete the paper form, you can mail or fax it to the IRS address or fax number specified in the form's instructions.
- With Your Paper Tax Return: If you are filing a paper tax return and need to report identity theft, you can attach Form 14039 to your tax return.
What Happens After Filing Form 14039?
The IRS will acknowledge receipt of your affidavit, usually within 30 days. They will then begin investigating your case. Your tax account will be "flagged" with an identity theft indicator, meaning future tax filings under your SSN will receive extra scrutiny to prevent further fraud.
Step 4: Consider Getting an Identity Protection Personal Identification Number (IP PIN)
An Identity Protection PIN (IP PIN) is a six-digit number assigned by the IRS to eligible taxpayers to help prevent the misuse of their Social Security numbers on fraudulent federal income tax returns. It's an excellent proactive measure to protect your tax account.
Who is Eligible for an IP PIN?
- Anyone who has an SSN or Individual Taxpayer Identification Number (ITIN) and can verify their identity.
- Victims of tax-related identity theft who have had their cases resolved by the IRS will often be automatically issued an IP PIN each year.
- You can opt-in to the IP PIN program even if you haven't been a victim of identity theft.
How to Get an IP PIN
- Online Account: The fastest and easiest method is through your IRS Online Account at IRS.gov/IPPIN. You'll need to verify your identity to access your account. Once logged in, you can enroll in the IP PIN program from the Profile tab.
- Form 15227: If you cannot verify your identity online or prefer not to use an online account, you can file Form 15227, Application for an Identity Protection Personal Identification Number, by mail or fax. An IRS employee will call you to complete authentication, and then your IP PIN will be mailed to you within four to six weeks.
- Taxpayer Assistance Center (TAC): You can schedule an appointment at a local Taxpayer Assistance Center to verify your identity in person. Once confirmed, the IRS will mail your IP PIN within four to six weeks.
Important Notes about IP PINs:
- Once you're issued an IP PIN, you must use it when filing any federal tax return (Forms 1040, 1040-NR, 1040-PR, 1040-SR, and 1040-SS) for that tax year.
- If you e-file your return and your IP PIN is missing or incorrect, the IRS will reject your tax return.
- A new IP PIN is generated and mailed to you each year (typically in December or early January) for the upcoming tax season. If you don't receive it, you'll need to retrieve it through your online account or by contacting the IRS.
Step 5: Follow Your FTC Recovery Plan and Monitor Your Credit
While the IRS handles the tax-related aspects, identity theft can affect many other areas of your financial life. Your FTC recovery plan will guide you through these broader protective steps.
Sub-Step 5.1: Place a Fraud Alert or Credit Freeze
- Fraud Alert: Contact one of the three major credit bureaus (Equifax, Experian, or TransUnion) to place a fraud alert on your credit file. This alert makes it harder for identity thieves to open new accounts in your name, as businesses will be required to verify your identity before extending credit. A fraud alert is free and lasts for one year, though you can renew it.
- Equifax: 1-888-525-6285
- Experian: 1-888-397-3742
- TransUnion: 1-800-680-7289
- Credit Freeze (Security Freeze): For stronger protection, consider placing a credit freeze with all three credit bureaus. A credit freeze restricts access to your credit report, meaning lenders cannot check your credit without your explicit permission. This makes it very difficult for identity thieves to open new accounts in your name. You can temporarily lift or "thaw" the freeze when you need to apply for credit.
- Contact each credit bureau individually to set up a credit freeze. The process is now free.
Sub-Step 5.2: Review Your Credit Reports Regularly
You are entitled to a free credit report from each of the three major credit bureaus once every 12 months through AnnualCreditReport.com. After identity theft, it's advisable to check your reports more frequently for any new fraudulent activity.
Sub-Step 5.3: Review Your Social Security Statement
Periodically review your Social Security Statement online at ssa.gov/myaccount to ensure that no one is using your SSN for employment purposes. Report any inconsistencies to the Social Security Administration.
Step 6: Maintain Vigilance and Follow Up
Identity theft resolution can take time. It's essential to remain vigilant and follow up on your case.
What to Expect from the IRS:
- The IRS will continue to process your legitimate tax returns.
- They will work to remove any fraudulent returns from your tax account.
- They will issue your refund if you are due one, but this might be delayed due to the investigation.
- They will eventually send you a notice confirming that your identity theft case has been resolved. This can take anywhere from 120 to 180 days, or even longer for complex cases.
Tips for Following Up:
- Keep a detailed record of all communications.
- If you have not heard from the IRS within a reasonable timeframe (e.g., 60-90 days after filing Form 14039), you can call the IRS Identity Protection Specialized Unit at 1-800-908-4490 to check on the status of your case.
- If you experience significant financial hardship due to the identity theft, you may contact the Taxpayer Advocate Service at 1-877-777-4778 for assistance.
10 Related FAQ Questions
How to know if my Social Security Number has been compromised?
You might know if your SSN has been compromised if you receive unexpected IRS notices about unfiled returns or balances due, your e-filed tax return is rejected due to a duplicate filing, or you see unfamiliar activity on your credit reports.
How to report identity theft involving my SSN to the authorities?
Start by reporting it to IdentityTheft.gov to get a personalized recovery plan and an official FTC Identity Theft Report. Then, use this report to file Form 14039, Identity Theft Affidavit, with the IRS.
How to get an Identity Protection PIN (IP PIN) from the IRS?
You can get an IP PIN by verifying your identity through your IRS Online Account at IRS.gov/IPPIN, by mailing or faxing Form 15227, or by visiting a Taxpayer Assistance Center.
How to check the status of my identity theft case with the IRS?
You can call the IRS Identity Protection Specialized Unit at 1-800-908-4490 to inquire about the status of your identity theft case after you've filed Form 14039.
How to place a fraud alert on my credit report?
Contact any one of the three major credit bureaus (Equifax, Experian, or TransUnion) and request to place an initial fraud alert on your credit file. They will then notify the other two bureaus.
How to put a credit freeze on my credit report?
You must contact each of the three major credit bureaus (Equifax, Experian, and TransUnion) individually to place a credit freeze on your report.
How to get a new Social Security Number if mine is stolen?
The Social Security Administration (SSA) rarely issues a new SSN. They typically only do so as a last resort if all other efforts to resolve the problems caused by the misuse of your current SSN have failed and you can prove ongoing harm. Contact the SSA directly to discuss your specific situation.
How to prevent future tax-related identity theft?
Always use strong, unique passwords for online accounts, be wary of phishing scams, secure your physical documents, and consider opting into the IRS IP PIN program. Regularly review your credit reports and Social Security Statement.
How to respond if the IRS sends me a letter about potential identity theft (e.g., 5071C or 4883C)?
Follow the instructions on the letter carefully. These letters usually require you to verify your identity with the IRS online or by phone. Do not file Form 14039 unless specifically instructed to do so by the IRS after receiving one of these letters.
How to get help if I'm experiencing financial hardship due to identity theft?
If your tax-related identity theft issue is causing you significant financial hardship, you can contact the Taxpayer Advocate Service (TAS) at 1-877-777-4778 for assistance. TAS is an independent organization within the IRS that helps taxpayers resolve problems.
