Tax Dictionary – Tax Identity Theft

IRS Definition:

Tax-related identity theft occurs when someone uses your stolen Social Security Number to file a tax return claiming a fraudulent refund.

More from H&R Block:

Tax identity thieves steal taxpayers’ names and Taxpayer Identification Numbers (like Social Security Numbers or Individual Taxpayer Identification Numbers) for one of two reasons:

To file a return to get your refund. This is the most common type of tax identity theft. You find out about it when you try to file a return, but the IRS rejects it because someone already filed a return using your information. If you file a paper return, the IRS will send you a notice telling you the same thing. Chances are, you’re the victim of tax identity theft.

To get a job and report the income under your Social Security Number. This type of fraud is an even bigger headache to resolve than a stolen refund. If this happens, you’ll find out about it later in the year, when the IRS sends you a notice about income that you didn’t report or pay taxes on. In fact, the income isn’t yours at all, but was earned by a thief and reported under your identity. Now, the IRS is auditing you or trying to collect taxes from you. These cases can take about a year to resolve. During that time, you’ll receive IRS notices and may even have your refunds frozen until the issue is resolved.

Learn how to address tax identity theft.

Related Topics

Related Resources

Tax Dictionary – Trust Fund Recovery Penalty (TFRP)

Does your business have unpaid payroll tax? Read the IRS definition of a Trust Fund Recovery Penalty (TFRP) and get insight from the experts at H&R Block.

IRS Notice CP187 – Reminder of Overdue Taxes

Learn more about notice CP187 and how to handle an IRS tax bill for your business with help from the tax experts at H&R Block.

IRS Letter 4838 – You Are a Client of a Payroll Service Provider

Learn more about Letter 4838, why you received it, and how to handle an IRS 4838 letter with help from the tax experts at H&R Block.

How to Handle an IRS Business Tax Audit

Learn what the IRS is looking for during a business tax audit, the steps you should take to prepare for an IRS audit, and when it's best to get expert help.