The IRS tax scam that emerged during the 2014 tax season continues to plague physicians and other health care providers during 2015. We have already had a number of ArMA member physicians notify us that they are victims of the scam. According to reports, fraudulent federal income tax returns using physician names, addresses and Social Security numbers are being filed electronically. IRS officials believe this scam is an attempt to fraudulently collect tax refunds through a sophisticated electronic redirection of refunds to fraudulent bank accounts that can then be accessed by the perpetrators. Victims are unaware of the identity theft until they attempt to file their taxes electronically, at which time they discover that a return has already been filed under their Social Security number. The IRS is sending 5071C letters to suspected fraud victims with instructions to contact the IRS identity theft website or call the IRS at (800) 830-5084. At this time, physicians are encouraged to go to www.experian.com/fraud and place themselves on a 90-day credit fraud alert. This could potentially slow or halt further attempted identity theft activities. This is only suggested out of an abundance of caution – we have no reason to believe that every physician is at risk. We understand that Experian will feed this information and fraud alerts to the other two major credit reporting agencies. If you remain concerned, it is suggested that you go back onto www.experian.com/fraud after 89 days to initiate subsequent 90-day credit fraud alerts. If you are NOT affected, our IRS agent contact does not recommend filing paper returns. In fact, it is considered best to file electronically as early as possible so as to prevent the bad guys from getting there first.
If you are a victim of this scam, please notify Chic Older, EVP, by emailing firstname.lastname@example.org with your full name, home address and phone number. The agencies involved have asked us to provide them with known victims so please let us know in your email that you authorize release of your contact information, including email address. Additionally, we have the following recommendations.
- IRS – If you are a victim of this scam, you’ll note the IRS 5071C letter provides instructions about contacting the IRS through its identity theft website guide (irs.gov/uac/Taxpayer-Guide-to-Identity-Theft) or by phone at (800) 830-5084 to let officials know you did not file the return referenced in their letter. If you are a victim, you will not be able to electronically file your return this year since a return with your Social Security number has already been filed. You’ll need to file a paper return and attach an IRS 14039 Identity Theft Affidavit to describe what happened. Attach copies of any notices you received from the IRS, like the 5071C letter. Be sure to let your tax preparer know if this happens to you. Verify with the IRS and your tax preparer where to mail your paper tax return, based on the type of return you are filing and your geographic area. Work with your tax preparer to file paper returns with Form 14039 (identity theft affidavit) and Form 8948 (e-file opt-out). You will also need an affidavit and a government issued ID (driver’s license or passport). The process of an individual filing the paper return with the Form 14039 notifies IRS that the paper return is the correct filing. IRS then removes the fraudulent filing from the taxpayers account, posts the correct tax return and if due a refund, issues the refund. The major way it impacts someone due a refund is that the process takes longer.
- Federal Trade Commission (FTC) – File a complaint with the FTC at https://www.ftccomplaintassistant.gov/#crnt&panel1-1. This not only helps the FTC identify patterns of abuse, but the printed version becomes your Identity Theft Affidavit. Along with a police report, that affidavit becomes your Identity Theft Report, which you will need. The FTC recommends other immediate steps and provides helpful information at consumer.ftc.gov/topics/repairing-identity-theft.
- Police report – Consider filing a report with the local police where you reside. Bring all documentation available, including any state and federal complaints you filed. This will likely be necessary if there is financial account fraud as a result of the identity theft. However, if the only fraud is tax fraud, the police report will be necessary only if requested by the IRS.
- Social Security – Call the Social Security Administration’s fraud hotline at (800) 269-0271 to report fraudulent use of your Social Security number. In case your number is being used for fraudulent employment, you can also request your Personal Earnings and Benefit Estimates Statement at ssa.gov/ or call (800) 772-1213. Check it for accuracy.
- Contact a fraud unit at one of three credit bureaus:
- Office of the Arizona Attorney General – Physicians affected can find additional guidance through the office of the Attorney General. Their website lists resources and steps for identity theft victims to take at https://www.azag.gov/identity-theft.
- If you have not received a notification from the IRS but believe your personal information may have been used fraudulently or are concerned about whether you may have been victimized, call the IRS Identity Protection Specialized Unit at (800) 908-4490. Find more information from the IRS, including forms, at the IRS website, http://www.irs.gov/uac/Taxpayer-Guide-to-Identity-Theft.