With tax day fast approaching there are some considerations for businesses and consumers regarding identity theft risks.
A recent survey conducted by Impulse Research Group on behalf of Experian showed that almost half of the respondents filed their own taxes electronically, another 20% file taxes by mail and 30% file taxes with the help of a tax professional leaving an enormous amount of room for information to be redirected without the knowledge of the individual.1
Cases of identity theft related to stolen tax returns have surged 300% according to Scripps Howard News Service investigation. An identity thief only needs one W2 or 1040EZ form to gather enough information to open a new credit card, rent an apartment and even file a fraudulent tax return in someone else's name. These complex instances of identity theft can take a toll on one’s credit and finances, making it important to educate your consumers and employees about taking a proactive stance to protect their privacy this tax season.
The survey also noted that 48% of the respondents store their tax documents in an unsecure place leaving them susceptible to being viewed by others and potentially putting them at risk for identity theft. 1 Businesses can also take heed from this warning by ensuring their tax documents are secure and proper destruction of documents takes place once the period of limitations for a return runs out.
Experian® Data Breach Resolution makes the following recommendations for tax-time information security:
For information about other topics such as credit cards, credit reporting, credit scoring, and fraud and identity theft, visit Experian's online credit education information.
1Tax Time Survey conducted by Impulse Research Group on behalf of Experian, March 2011