Employment Related Identity Theft
When people think of identity theft, they tend to associate it with credit cards, loans, or something else of that nature. But, there is another kind seldom reported - Employment-Related Identity Theft.
Employment-Related Identity Theft is when other individuals use a victim’s social security number (SSN) in order to gain employment and file taxes. This can create a significant burden on the victim and cause the IRS to calculate the victim’s final refund or taxes incorrectly.
Fortunately, the IRS has implemented a system to identify when Employment Identity Theft may be occurring through the process of verifying Individual Taxpayer Identification Numbers (ITIN) and SSN’s. When a discrepancy occurs it is recorded by the IRS. The SSN is noted or "Red Flagged" in order to keep victims from being labeled as having income discrepancies (which can result in an audit). The IRS then sends a message to the potential victim alerting them that they may have been subject to Employment-Related Identity Theft.
However, even with these procedures the IRS may not catch every case of Employment-Identity Theft. Current statistics show, under the Treasury Inspector General for Tax Administration, as many as 458,658 repeat victims were not notified of identity theft. Also, 13.5% of the 112,445 identity theft notices that were sent, were found to be sent erroneously to people who were not victims (Federal Tax Weekly, Wolters Kluwer, Issue 8, pg. 6, 22 February 2018.)
When the safeguards of the IRS fall short, The Center for Financial, Legal & Tax Planning, Inc., provides cutting edge tax and accounting software to deliver maximum security to all of our client’s confidential information. From associate login numbers, entry tracking, masking of documents, with onsite and offsite back up servers, our clients are provided the maximum amount of security and protection. Additionally, the experience and knowledge of our accounting and tax specialists allow us to key in on any potential discrepancies with your tax or accounting documents. If you’re concerned about the protection of your most vital personal information, contact the Center (618)-997-3436 to see what we can do for you.