Don’t Wait to File Your Taxes This Year

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You know that saying “that good things come to those who wait”? Well unfortunately, it doesn’t apply in the income tax world, especially over the past few years to some people who have waited until late March or April to file their personal Federal income tax returns.

The crooks, scammers or just plain bad guys have found ways to use other people’s identities for the purpose of obtaining fraudulent tax refunds. That’s right. It’s not just credit card identity theft that you need to be concerned about, now you have to worry about tax-based identity theft. Maybe fraud is a better description, because they don’t really want to steal your identity, just borrow it briefly.

Here’s how it works, the crook makes up a fake W-2 with your name and social security number. They give you plenty of Federal tax withholding on your W-2 so that you are due for a nice refund. The crook then files early and often (basically before you do) and claims that fraudulent generous refund for themselves. The Federal government has lost BILLIONS on allowing this.

The State of Ohio is one of only a handful of states that started an “identity quiz” for those claiming refunds. Ohio blocked over One-half Billion Dollars in potential fraud losses last year by using tighter controls.

So if the crook files for you on February 10th, then it isn’t until you file say around March 10th that the problem gets discovered. You try to e-file and the IRS informs you that they ALREADY have a tax return on file for you.

How could this happen? Simple, the IRS system doesn’t receive the actual W-2, 1099, etc. income information posted in their system until August. Yes, eight months later.

What’s the moral of this story? You need to take action now and get your 2015 taxes prepared and filed right away. Procrastinate on something else this year.

To help our clients, we have started doing our tax preparation even earlier over the past couple years. In addition, we have become well versed in helping those who find themselves victim of this type of tax-based identity theft. If you or someone you know does encounter this situation, we are here to help.