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Identity Theft Can Hurt Your Taxes If your identity is stolen, thieves can use your bank account, charge against your credit cards, destroy your credit, and open/abuse new accounts, etc. But is that it? Ever wondered what else can identity theft do? You'll be surprised! Identity theft can hurt and impact your tax returns immensely. How so? 1) File Tax Returns To Get a Refund The identity thief can file a tax return under your name, in order to get refunds. What if you are not really eligible for refunds? Well the identity thief can record all types of misleading deductions, in order to get a refund. Therefore, the identity thief will walk away with pockets full of money, and it will be you who will have to attend the tax audits (and thus face the troubles). |
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2) Sale of Social Security Numbers Identity thieves have created for themselves new channels of revenue and new ways of making money. This is done by selling social security numbers. If you are wondering who would possibly want to buy these numbers, the answers include: - Illegal workers with no legal work documents How can this create problems for you? Well, any income that is paid to these thieves will be reported as being paid to you. This results in the IRS thinking you have bigger incomes than you actually do, as well as you under reporting your income. How to Protect Yourself From This Type of Identity Theft If you receive any of the following types of notices from the IRS, that means someone may have used your Social Security Number for fraud: More than one tax return was filed under your name or |
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Compound interest - why it is bad to cash out your 401(k) plan: Reasons why you should participate in your 401(k) plan: |
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