Every year, like clockwork, tax season comes upon us like a big pimple on prom night.  And it doesn’t just bring W-2s and refunds, it also draws out identity thieves hoping to cash in on your hard-earned money. One of the most common tax-related scams involves crooks filing fraudulent returns using stolen Social Security numbers. And unless you act fast, they can get to your refund before you do.

 

This scheme isn’t new, but it’s just as dangerous now than it’s ever been. According to the Federal Trade Commission, these types of identity theft cases spike every spring. So what can you do to stay ahead of scammers this tax season?

Why This Scam Keeps Working 

Criminals are banking on one thing: many taxpayers file late. If they can access your Social Security number before you file your legitimate return, they can submit a fake one in your name and claim your refund.

 

If that’s not bad enough, it gets worse.  The thing is, most people don’t even realize they’ve been targeted until the IRS rejects their filing with this terrifying notice:

 

“A return has already been filed using your SSN.”

Scammers typically gain access to your personal information through phishing emails, data breaches, or weak login credentials on tax preparation websites. Once inside, they move fast.

Once scammers get access to your accounts, they waste no time transferring your money into their pockets. (iStock)

How to Protect Your Tax Identity 

Fortunately, there are simple steps you can take to lower your risk of falling victim to this type of fraud:

  • Enable two-factor authentication on all tax-related accounts, such as TurboTax, H&R Block, and even your IRS.gov profile. This adds a second layer of security, making it much harder for intruders to gain access.
  • File early. If your return is submitted before a scammer has a chance to act, you effectively block them from using your identity.
  • Use strong, unique passwords for tax prep accounts, and don’t reuse them on other sites.
  • Beware of phishing emails. If a message seems off or urgent, don’t click links. Navigate directly to the provider’s website instead.

And if your personal information has already been compromised, don't panic. The FTC has set up IdentityTheft.gov, a one-stop resource where you can report the fraud and get step-by-step help for recovering your identity and securing your accounts.

Protect yourself by enabling two-factor authentication, filing early, using strong unique passwords, and staying wary of potential phishing messages. (iStock)

What to Do if You’ve Been Targeted 

If you discover that someone has fraudulently filed a return in your name, act immediately:

  1. Report the fraud to the IRS by submitting Form 14039 (Identity Theft Affidavit).
  2. Visit IdentityTheft.gov to create a recovery plan tailored to your situation.
  3. Place a fraud alert on your credit reports through one of the three major bureaus: Experian, Equifax, or TransUnion.
  4. Notify your tax preparer if you used one, so they can take precautions in case the breach occurred through their system.

Time is of the essence in these situations. The sooner you act, the less damage a scammer can do.

Final Thoughts: Keep Your Guard Up Year-Round 

While tax season might be the peak time for these types of scams, identity theft is a year-round threat. Staying vigilant with your digital security (especially when it comes to financial information) can save you months of stress and thousands in lost refunds or legal fees.