How can you protect yourself from refund fraud during tax season?

Refund fraud starts when someone uses your Social Security number or other personal data to file a false tax return and claim a refund in your name. The good news: many tactics are simple and effective. Below are clear, prioritized actions you can take before and during tax season, plus recovery steps if you become a victim.

Prevention: highest-impact actions (do these first)

  1. File early
  • Filing your federal return as soon as you have the documents reduces the window a fraudster has to submit a return in your name.
  1. Get an IRS Identity Protection PIN (IP PIN)
  1. Freeze or monitor your credit
  1. Secure accounts and communications
  • Use strong, unique passwords and a password manager. Enable two-factor authentication (2FA) everywhere your tax data is stored (tax software, email, bank portals).
  • Share documents with your tax preparer via encrypted file transfer or password-protected files; avoid sending SSNs in plain email or text.
  1. Choose a reputable tax preparer
  • Confirm preparer credentials (PTIN, EFIN when applicable), read reviews, and verify they use secure e-file systems. Keep a copy of your signed return and the preparer’s contact details.
  1. Limit data exposure year-round
  • Shred paper with SSNs, review privacy settings on accounts, and be cautious with phishing emails or texts that ask for personal information.

What to do if you suspect refund fraud

  1. Act quickly
  • If the IRS notifies you that a return was already filed in your name or you can’t file because your SSN was used, go to IRS Identity Theft Central for steps: https://www.irs.gov/identity-theft-central (IRS).
  1. File Form 14039 (Identity Theft Affidavit) when directed
  1. Report identity theft to the FTC and use IdentityTheft.gov
  • The FTC’s recovery site guides you through a tailored recovery plan and prepares an identity theft report you can use with creditors: https://www.identitytheft.gov (FTC).
  1. Place fraud alerts or credit freezes
  • Contact Equifax, Experian, and TransUnion to request a fraud alert or freeze (CFPB resource above). A freeze is stronger; an alert warns lenders to take extra steps.
  1. Check your IRS account and tax transcripts
  • Request your IRS account transcript or create an IRS online account to see recent return activity. If you receive IRS notices, follow the document instructions and keep copies.
  1. Contact the three credit bureaus and your financial institutions
  • Review recent accounts and transactions and close or freeze any accounts that are suspicious.

What to expect during recovery

  • The IRS may place a marker on your account and require identity verification before releasing refunds. Recovery can take weeks to months depending on complexity.
  • Keep careful records of all calls, notices, and forms you submit. If you work with a tax professional, ensure they document communications.

Common mistakes and misconceptions

  • “If I have antivirus, I’m safe.” Antivirus helps, but social engineering (phishing) and data breaches are common ways thieves get SSNs.
  • “I don’t make much money, so I’m not a target.” Low-income taxpayers who qualify for refundable credits are often targeted because fraudsters seek easier refunds.

Practical tips from my practice

  • Prioritize the IP PIN and a credit freeze if you’ve been breached or notified by the IRS.
  • Keep a year-round folder (digital or paper) of tax documents and records of identity-theft communications.
  • When hiring a preparer, ask how they secure client data and whether they carry E&O insurance.

Useful resources and internal guides

Internal FinHelp guides you may find helpful:

This article is educational and not personalized tax or legal advice. If you suspect tax-related identity theft, follow IRS and FTC guidance and consult a qualified tax professional for help specific to your situation.