Jory MacKay is a writer and award-winning editor with over a decade of experience for online and print publications. He has a bachelor's degree in journalism from the University of Victoria and a passion for helping people identify and avoid fraud.
What Happens If Someone Uses Your SSN To File Taxes?
When Lena received an IRS notice saying that her tax return was rejected, she thought it was an issue with the online system. But a phone call later, she realized the truth: someone had used her Social Security number (SSN) to electronically file (e-file) a fraudulent income tax return in her name and steal her refund [*].
Tax identity theft is a growing problem for thousands of Americans. In 2022 alone [*]:
The IRS received over 7.8 million reports of potential tax identity theft and fraud.
At best, a duplicate or fraudulent tax return can cause delays in receiving your refund for the year. At worst, it can lead to additional theft and fraud — from emptied bank accounts to fraudulent loans taken out in your name, or even criminal identity theft.
If someone has used your SSN to file taxes, it’s your responsibility to investigate and report the issue.
In this guide, we’ll explain how to tell if someone has filed a fraudulent tax return using your SSN and what you should do to protect yourself from further harm.
Can Someone Use Your SSN To File Taxes? How Bad Is It?
Tax identity theft occurs when someone steals your Social Security number to file taxes in your name and claim your refund. Typically, a scammer only needs your name, birthday, and SSN to commit tax return fraud.
Unfortunately, fraudsters have more ways than ever to obtain stolen SSNs. They could purchase your SSN on the Dark Web after it’s been leaked in a data breach — or steal your mail, sensitive documents, ID cards (such as your driver’s license), or trick you into providing personal information by targeting you with a phishing attack.
Even worse, in many cases, the criminals behind tax identity theft are unscrupulous tax preparers — or even victims’ own family members.
Once a scammer has your SSN, here’s how tax identity theft plays out:
Identity thieves use your stolen information to create an online e-file account in your name or file a fraudulent paper return.
Next, they add fake income and benefits information to max out the return amount.
They also change the deposit and contact information so that they receive the tax refund — and you won’t receive a notification.
When you file your legitimate tax return, the Internal Revenue Service (IRS) will reject it as there’s already been a return filed under your name.
While tax identity theft can happen at any time during the tax year, it increases during the months leading up to tax season — especially February and March.
✅ Protect your savings from tax fraudsters: If scammers have your SSN, they could take out loans or open new accounts in your name. Try Aura’s award-winning identity theft protection solution free for 14 days and safeguard yourself from scammers.
How To Tell If Someone Has Filed Taxes in Your Name
Unfortunately, it’s not always obvious when someone has filed taxes in your name or used your SSN for other types of identity theft. Many victims only discover the fraud when they attempt to file their taxes, or if they receive an IRS form asking for more information about the fraudulent return.
But catching the warning signs of tax identity theft is essential if you want to minimize the damage that identity thieves can do.
Here are some of the biggest warning signs that someone used your SSN to file taxes:
Your tax return is rejected. If scammers file taxes using your SSN before you do, the IRS will inform you that your legitimate tax return was denied due to a duplicate SSN.
You receive a Letter 5071C from the IRS. The IRS sends this fraud alert notice if they see signs of identity theft on your return.
You receive a W2 or 1099 Form for a job that you didn’t work. Scammers may be using your personal information or Employment Identification Number (EIN) to work or run an illegal business.
You receive tax transcripts that you didn’t request. Taxpayers can request tax transcripts to help file their returns. If scammers forget to change your address before requesting your transcripts, you may receive the transcripts.
You get an alert that your SSN was found online. Aura’s award-winning identity theft protection solution can warn you if your SSN was found on the Dark Web or is being used by scammers.
There are unfamiliar background checks on your E-Verify account. If an employer you don’t recognize has requested a background check, this likely signifies that you’re the victim of employment identity theft.
You are notified that an online IRS account has been created in your name. This can happen if the person opens an IRS.gov account using your SSN but doesn’t change the contact information.
The IRS has employment information that you don’t recognize. Scammers will often report a salary that you didn’t earn to increase tax withholding refunds.
As soon as you see signs that your SSN was used to file a fraudulent tax return, you need to act quickly. Here’s what to do:
1. Notify the IRS immediately and file a Form 14039
How you respond to ID theft and tax fraud will depend on whether you notice it before or after the IRS does.
What to do if you notice signs that your identity was stolen before the IRS does:
File your paper tax return and include a Form 14039 (Identity Theft Affidavit). This form informs the IRS that you believe you’re a victim of identity theft. You’ll need to mail it to the IRS address in your state or to the address where you would normally send it.
What to do if the IRS informs you first that your identity was stolen (or possibly stolen):
The IRS will send you a 4883C or 6330C letter with a request that you verify your identity and declare that you did not file the false tax return under investigation. You’ll also likely have to speak to an IRS agent over the phone, or you may need to visit your local IRS Taxpayer Assistance Center.
2. Respond to any IRS letters (5071C, CP01E, etc.)
The IRS actively reviews tax returns for possible fraud. If they see anything suspicious, there are several different letters they might send requesting more information.
Here’s what these IRS letters mean, and what you should do when you receive one:
5071C letter. If you receive this letter, you’ll be asked to use the online Identity and Tax Return Verification Service to verify your identity and let the IRS know if you sent in the return under question. If you receive a 5071C, you don’t have to file an Identity Theft Affidavit. However, you do need to follow all instructions in the letter.
CP01E letter. The IRS will send this letter if they suspect someone else used your SSN to gain employment. If you receive this letter, there is no known tax identity theft. However, you should check your finances and tax accounts for any signs of fraud.
It’s essential to respond to any letters that you receive, as the IRS will not be able to process your tax return until you submit a response.
For additional help, you can call the IRS Identity Protection Specialized Unit’s phone number at 1-800-908-4490.
3. Request a copy of the fraudulent tax return
The IRS will provide a copy of the fraudulent tax return to help you identify the criminal or look for further instances of identity theft. You can only request a copy as the primary or secondary taxpayer. The IRS may also redact some sections of your tax return to protect you against additional risks.
Here’s how to request a copy of a fraudulent tax return made in your name:
Fill out Form 4506-F — Identity Theft Victim’s Request for Copy of Fraudulent Tax Return.
You can submit the form by mail or fax (not both).
The mailing address is: Department of the Treasury, Internal Revenue Service, Fresno CA, 93725.
The toll-free fax number is 1-855-807-5720. You’ll want to include a cover sheet labeled “Confidential.”
The IRS will acknowledge receiving your request within 30 days of receiving it. You should receive the tax return or a follow-up correspondence within 90 days.
4. Report the fraud to the FTC, law enforcement, and your bank
Tax identity theft can be a warning sign of even worse types of identity theft. As soon as you’ve dealt with the immediate fraud, you should contact the FTC, your local police, and your bank to notify them of the fraud.
How to report identity theft to the FTC:
Go to IdentityTheft.gov, click “Get Started,” and then select the option “Someone filed a federal tax return using my information.”
Follow the instructions and include as many details as you can (such as a copy of the fraudulent return).
After you submit your report, you’ll receive an official identity theft report from the FTC, along with a personalized recovery plan. Keep your FTC report close by, as you’ll need it when you report the fraud to other agencies and companies.
How to report the fraud to your local law enforcement:
Call or go in person to your local law enforcement office. Explain that you’re the victim of identity theft and that someone filed a tax return in your name.
Be prepared to provide as many details as possible. If you already have a copy of your FTC report, the police may want a copy as well.
Request a copy of the report you file with law enforcement and keep it in your file. Your bank or credit card companies may request a copy.
You may also want to consult with a lawyer or get independent legal advice to decide on your next steps.
How to report the fraud to your bank:
Contact your bank or lender’s fraud department and inform them that you’re the victim of identity theft. They’ll most likely close or freeze your accounts to limit the damage.
You may be asked to provide specific information about the identity theft, including your FTC and police reports.
These steps can be time consuming, but they can also protect you from the consequences of further identity theft and fraud.
5. Freeze or lock your credit with all three credit bureaus
One of the worst consequences of tax identity theft is if scammers use your SSN or information from your tax documents to open new credit accounts. Freezing or locking your credit with all three credit bureaus individually — Equifax, Experian, and TransUnion — can prevent thieves from opening new accounts or taking out loans in your name.
More than 50% of identity theft victims are repeat victims [*]. Once you know you’ve been a victim, it’s important to check your credit report, bank statements, credit card statements, and other financial statements for signs of fraud.
When checking your credit report or financial statements:
Look for inconsistencies or unfamiliar information — such as new bank accounts, credit cards, or loans that you didn’t take out.
Check your monthly credit card statements for any charges that you didn’t make. Report these immediately, as your credit card company may be able to reimburse you for some or all of the charges — but only if you report them in a timely manner.
Check your bank account statements for unfamiliar withdrawals, new accounts, or loans for which you didn’t apply.
If you find fraudulent financial information, contact the impacted financial institution as soon as possible to report the fraud.
7. Consider signing up for identity theft protection
Identity theft and tax fraud can’t always be avoided. However, you can increase your protection and limit any damage by signing up for Aura’s identity theft protection with SSN monitoring.
Aura can monitor your financial and personal identifying information (PII) for signs of fraud, and alert you in near real-time if your information is compromised or there's signs of identity theft.
How Long Does It Take the IRS To Investigate Identity Theft?
The IRS states that its goal is to finish investigations within 120 days or less [*]. But this can vary depending on the complexity of your case and the number of cases being investigated — with some cases taking anywhere from 180 to 430 days.
Here’s what happens when the IRS discovers that your identity has been stolen:
The IRS will send you a letter within 30 days of receiving the report of your tax identity theft case.
IRS employees specifically trained to investigate tax identity theft will then work on your case. This includes ensuring that your latest return is correctly processed, fraudulent files have been removed from your account, and that you’ve been issued an appropriate refund.
Your tax account will be flagged to help detect future fraudulent filings.
After all issues are resolved, your case will be closed, and you will be notified.
You can periodically check in with the IRS on the status of your case while it's under investigation.
How To Protect Your Personal Information This Tax Season
Safeguard your SSN. Keep documents and letters with your SSN in a secure place and shred them when no longer needed. Try to use a different form of identification when asked to provide your SSN online.
File your taxes early. If you file your taxes early, scammers won’t be able to submit fraudulent returns in your name.
Regularly check your Social Security Statement for inconsistencies. You can access your statement from the Social Security Administration (SSA) and look for income and employment information that you don’t recognize.
Secure your online accounts with strong passwords and 2FA. Hackers often try to access your online accounts to mine for personal data. Strong passwords and two-factor authentication (2FA) can keep your online information safe.
Learn to spot the signs of phishing scams. Be careful of any unsolicited messages, phone calls, or emails.
Claim your E-Verify account. This prevents scammers from filing taxes online under your name.
Request an Identity Protection Personal Information Number (IP PIN). If you think you’re at risk of identity theft, the IRS can provide an additional PIN that you’ll need to enter when submitting your taxes.
Get your mail each day — especially during tax season. This will help prevent thieves from stealing documents that contain your personal information.
Research tax preparers. If hiring professionals to help you with your taxes, double-check that they’re legitimate and have the required qualifications.
The Bottom Line: Keep Your SSN Safe From Tax Scammers
By keeping your personal information secure, filing your taxes early, and carefully reviewing your financial records, you can significantly reduce the risk of tax fraud. But if you do fall victim to tax fraud, it's essential to act quickly and report the incident right away.
For added protection, consider signing up for Aura’s all-in-one digital security solution. Aura monitors your SSN and other sensitive personal and financial information, and can alert you in near real-time to any signs of fraud so that you can shut down scammers before it’s too late.