Around one-third of Americans procrastinate filing their taxes. But no matter how tempting it sounds, it’s not a good idea — unless you want to risk your identity being stolen.
Tax-related identity theft is one of the biggest reasons to file as soon as your documents are ready, experts say. The fraud, defined on the Federal Trade Commission website, can happen when someone gains access to your Social Security number or other personal information to steal your tax refunds or gain employment.
According to CNBC, tax identity theft has become a “serious problem,” with more than 15,000 identity theft tax returns reported from the 2024 filing season — an increase from 12,600 cases in 2023. The processing time for these cases is now at an average of 22 months, up from 19 months last year.
The New York Department of State website recommends installing firewalls in your computer and shredding any documents with sensitive information. It also warns about scam messages that appear to be sent from the IRS, asking about personal or financial information through phone, email or electronic message.
Ultimately, the best way to defend against tax identity fraud is to file your taxes early, so scammers and identity thieves aren’t able to get to it before you.
“If you have all your documents, get that return submitted,” tax attorney Adam Brewer told CNBC. “There’s nothing good that comes from waiting.”
However, that’s not to say you should be hasty. If you want to avoid delays on your tax returns, especially given the recent IRS layoffs, it’s best to check every detail carefully to ensure completion and accuracy. As Tom O’Saben, director of tax content at the National Association of Tax Professionals, put it: It’s always better to “measure twice, cut once.”
Wondering if the thousands of IRS layoffs this week will impact your refund? O'Saben says it shouldn't be affected if you file electronically and select direct deposit for payment. Returns are usually processed within 21 days.
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