Filing Taxes Online
Although more consumers have shifted to filing online these days, they may question whether e-filing offers the most security for their tax and personal information. Recently, TurboTax stopped electronic filing for state returns after there were reports of an increase in tax fraud, The Wall Street Journal reported. While the company's website itself was not compromised, identity thieves were more likely to file fake tax returns using an electronic filing service.
How to be more secure: As consumers file their taxes online, they should be sure to avoid Internet-based tax scams. Consumers may receive emails from senders claiming they are with the IRS, prompting taxpayers to resend their personal information. When filing electronically, consumers should make sure their devices are free of malware, a risk that could allow cybercriminals to access their information remotely, according to the IRS. Taxpayers should also send their information through secure Internet connections.
Filing on Paper
On the other hand, some consumers prefer filing their taxes on paper because they are most familiar with this method. However, there are certain risks involved as identity thieves could attempt to steal important paper documents from taxpayers or by dumpster diving for documents that were thrown away.
How to be more secure: Whether taxpayers do their own taxes or hire a certified tax preparer, they should keep any paper documents and copies secure. Taxpayers should ensure they prevent sensitive documents containing their personal information like Social Security numbers and dates of birth from falling into the hands of would-be identity thieves. Consumers can either shred these documents or lock them away in a safe. They could also consider locking their mailboxes to avoid identity thieves from pilfering their mail without consumers' knowledge.
As consumers consider the benefits and disadvantages of filing their taxes online or through mail, they should decide how they could improve their personal information's security to avoid becoming a victim of tax fraud and identity theft.
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