tax seasonUpdated: Jan. 25, 2016

It’s that most-dreaded time of year again for Americans everywhere: tax season. Last year saw record-breaking instances of tax fraud, with security issues at both the state and federal levels raising eyebrows. Although many efforts have been made by governments and tax preparation services to increase security, the fact remains that tax identity theft is an issue that all taxpayers need to be aware of and take steps on their own to try and circumvent. Although the IRS has worked to convict nearly 2,000 identity thieves over the past year, there are always more criminals lurking as tax season approaches. Unfortunately, identity thieves are adept at remaining one step ahead of those who seek to wipe them out — making it necessary for everyday people to take precautions to keep themselves protected.

What is tax identity theft?

Tax identity theft is fairly simple — it happens when someone files a tax return using someone else’s information and receives a fraudulent tax refund in return. Unfortunately, victims usually don’t know they’ve been targeted in this manner until after it happens, since the most common way to find out you’ve been a victim of tax identity theft is to file your tax return and get told by the IRS that someone’s already filed using your information.

What can I do to try and avoid tax identity theft this tax season?

1. File as early as you possibly can. Putting off doing your taxes almost seems like a national pastime, but it’s easily one of the worst things you can do because it gives thieves plenty of time to file a fraudulent tax return for you. Tax season officially kicked off on Jan. 19 and the official deadline for employers to mail out W-2 forms to employees is Jan. 31, so be on the lookout through the months of January and February. If you haven’t received your W-2(s) by the end of February, it’s a good idea to contact any employers who owe you one to find out where yours is. The way tax identity theft works is that thieves file fraudulent forms in the hopes that they beat you to the punch. The sooner you file, the less likely this will happen.

2. Keep your tax data and personal information secure. Hopefully you know better than to carry your social security card around with you, but you should also try to keep it locked away somewhere secure like a lock box or a locked filing cabinet. The same goes for any other important papers and data, tax-related or not, which could potentially be used to help a thief file taxes in your name. Be sure to shred any papers you’re finished with rather than throwing them straight in the trash, as identity thieves love dumpster diving, and take care to take the same precautions with computer files as you do any physical documents.

3. Avoid falling victim to phishing scams. Every year, thousands are compromised after clicking on links in scam emails they receive. Some scammers are capable of creating very sophisticated-looking emails that mimic what you’d see from the IRS or a popular tax preparation service. It’s vital that you pay attention when reading your email and avoid clicking links or downloading attachments unless you are 100% certain you know the message is from a legitimate source. Remember, the IRS does not contact people via email or telephone regarding issues with tax returns — this type of contact generally only comes by way of postal mail. Regarding emails and phone calls with high suspicion is a great way to keep yourself safe from scammers.

4. Be careful who you trust to do your taxes. Sadly, many of the perpetrators of tax fraud are the same people who offer to prepare and send your taxes for you. Depending on your financial situation, it might be necessary to consult with a professional to make sure you cover every detail — but it’s important to be sure that you’re using a trustworthy preparer or service. Some of the top-rated online tax preparation services, such as H&R Block, offer in-person consultations, and while it might be cheaper in the short-term to use the services of someone advertising on Craigslist or running an operation out of their living room, you might find yourself paying far more in the long-term if you use a person/service that is either dishonest or doesn’t have the proper security measures in place to prevent their clients’ information from theft.

5. Contact the IRS straight away if you suspect something is wrong. Unfortunately, the only way to know you’ve been a victim of tax identity theft is to file your taxes and receive word that taxes have already been filed using your information. If that should happen, or if you suspect your information might have been part of a data breach or otherwise stolen, it’s important to contact the IRS or your local state tax officials as soon as possible. There are forms you can fill out to report that you’ve been a victim of tax fraud which will help ensure you don’t get hit with fines or other legal action down the line. The good news is, it is possible to receive your refund even if a thief has already beaten you to the punch — it just might take time and effort on your part while the IRS sorts everything out.

Although tax identity theft isn’t 100% preventable, following these steps can help make you a less likely target. To learn more about protecting your identity all year round, visit our reviews of the top identity theft protection services.