tax identity theftAccountants and IRS agents, rejoice: tax season is upon us. While the rest of the country groans and starts assembling the necessary paperwork to complete this least-favorite annual ritual, another group of people is gearing up, as well — identity thieves. Tax returns are a huge potential payday for enterprising fraudsters, with confirmed fraudulent tax returns reaching its peak in 2015 to the tune of 1.4 million. Since then, tax identity theft has actually decreased — dropping 65% over the past two years, according to the IRS.

However, one of the biggest factors behind this decrease has been awareness campaigns by the IRS, FTC and consumer protection groups — like the Tax Identity Theft Awareness Week campaign — as well as efforts made at the state and federal levels to increase security. Like most forms of crime, the better educated people are about how to protect themselves, the better they can avoid falling victim. Tax identity theft may be on a two-year downswing, but there are some potential issues to be aware of going into the 2019 tax season which could lead to a spike in reported fraud. Read on to learn what’s different this year and what you can do to guard yourself against tax identity theft.

Why tax identity thieves have a potential advantage this year

There are a couple of things that could give identity thieves and other fraudsters an edge this tax season. First, the government shutdown that lasted 35 days from December 2018 to January 2019 has indubitably put most government agencies behind — including the IRS. We wrote about the various scams facing consumers as a result of the shutdown, and top cybersecurity experts purport that the impact this event will have on national security overall is likely to be far-reaching. According to information given to lawmakers by the IRS as well as consumer watchdog group the National Taxpayer Advocate, it could take at least a year or as long as 18 months for the IRS to recover from the shutdown. The agency is reportedly “facing millions of unanswered taxpayer letters, [is] weeks behind schedule on training for workers and in need of hiring thousands of new employees for this tax filing season,” according to the Los Angeles Times. This means that, despite all the recent improvements the agency has made to its security and processes, scammers will likely have a leg up thanks to all of the confusion this year.

Adding to the mayhem are a number of changes to the tax code that go into effect for this filing season, which aim to make filing even more arduous for many taxpayers. Given that one of the key ways to protect yourself against tax identity theft is to file as early as possible, anything that might delay people from filing their taxes is a win for identity thieves. And if you think your information isn’t out there, ready to be plugged into fraudulent tax returns in hopes of a criminal absconding with your return before you can file, you’d be wrong — every data breach that exposes names, birth dates, addresses and social security numbers, like the massive Equifax breach from 2017, offers tax identity thieves plenty of ammunition to use for their misdeeds.

What can taxpayers do to protect themselves?

Bottom line, this year is going to be one of the most chaotic tax years ever, and all the uncertainty and delays are only going to embolden those who are looking to take advantage of others. The filing season was finally kicked off Jan. 28, several weeks later than normal, but it might not be a breeze to get your taxes filed immediately. Once you do get everything submitted, you should prepare yourself for a longer wait than usual on that return. At best, taxpayers can expect at least a week’s delay in getting their refund. It typically takes the IRS 21 days to process returns, though some might take longer depending on how complicated the filing was or if certain credits were claimed (e.g., those who claim the Child Tax Credit or Earned Income Credit often have theirs held due to returns filed with those credits frequently being fraudulent). Because of the massive delays caused by the shutdown, we could see things taking much longer this year.

Regardless of the chaos, you can still keep things under control on your end and protect yourself from tax identity thieves. Here are some important things to keep in mind as you file your taxes this year:

1. File as early as possible. It might not be a breeze this year, depending on whether or not any of the tax code changes impact you or if you’re a government employee whose pay and W-2s were delayed due to the shutdown, but you should still aim to get your filing squared away as soon as you have all the necessary paperwork in hand. Tax identity theft is a race to see who can submit faster, you or the perpetrator. If you can beat them to it, then you’ll be able to rest easy for another year until it’s time to do this all over again next January.

2. Follow up. Don’t just file and forget about it; check up on the status of your return with the IRS and your state tax agency to ensure that your taxes were received and are being processed. In the event there is an issue, it’s better to know about it sooner rather than later so you can take care of the problem. Remember that the IRS has very specific methods it uses to contact people — many scammers rely on provocation of fear and anxiety to sway unsuspecting victims, so you’ll want to be sure you know how and when the IRS will contact you (and how it won’t). You can get the 411 on what it’s like to personally deal with tax identity theft by reading our editor’s experience from a few years ago.

3. Read up on the warning signs of tax identity theft (and other tax-related fraud). Education is one of the best weapons against fraudsters, so giving yourself a thorough education on what to look for when it comes to this type of identity theft is never a bad idea. You can get some quick tips by reading this document published by the IRS to inform taxpayers or looking through our posts from past tax seasons. Keep in mind that plenty of other scams and schemes are waiting to take advantage of unwary taxpayers, like fake phone calls from the IRS and false tax professionals who take your money and run (or fudge the numbers, leading to a costly audit). Finally, don’t forget that it’s not only adults who are at risk for becoming victims — children are valuable targets for fraudulent tax returns since they are the most unlikely to catch the fraud.

4. Know what to do if it happens to you. Identity theft is all-too-common these days, so if it happens to you, don’t panic. There are steps you can take to report the fraud, get assistance making things right and shore up your defenses for the future. In the event that you file your taxes and it turns out someone beat you to the punch, the IRS and the FTC have plenty of resources to help you file a report and get your return properly re-submitted and accepted. The good news is that any money lost by the IRS to fraudsters is never on the taxpayer — you will still be able to receive any refund due to you, and you won’t owe it back. The IRS will also provide you with extra security to protect you when you file in the future, which you can learn more about here.

Filing taxes is rarely on anyone’s list of the most fun tasks they look forward to, but following the tips above and keeping your wits about you will help make it a smooth process. It’s still unknown whether the government will experience another shutdown, which would add to the chaos and delays the IRS and other agencies are currently facing, so if you’ve got all your paperwork in order, our advice is to file immediately — that way, even if another shutdown occurs, you can rest easy knowing that you’ve done your job.

Follow our identity theft protection blog to keep up on the latest news and get our top tips for keeping you and your loved ones secure.