Identity Thieves Love Tax Season

Author

Senior Tax Advisory Group

Posted on

Jan 03, 2023

Book/Edition

Colorado - Colorado Springs

The vast amount of information shared online during tax season makes it a haven for identity thieves, and they're doing everything they can to take advantage of the opportunity! Here are several ways that identity thieves are targeting you, common signs of ID theft and steps to take if you become a victim.

How Identity Thieves Target You

  • Impersonating the IRS. Thieves calling you and claiming to be the IRS will try and intimidate you into making an immediate payment using a gift card or wire service. Remember, the IRS will physically mail you a letter as a means of first contact. And the IRS will never call you to demand an immediate payment.
  • Filing a fraudulent tax return. Identity thieves often try to file a tax return using your Social Security number before you do. So consider filing your tax return as quickly as you can to beat identity thieves at their own game.
  • Phishing schemes. Be on the lookout for unsolicited emails, texts and social media posts that prompt you to share personal and financial information. These messages could also contain viruses, spyware or other malware that could infect your electronic devices.

Common Signs Of ID Theft

Here are some of the common signs of identity theft according to the IRS:

  • In early 2023, you receive a refund before filing your 2022 tax return.
  • You receive a tax transcript you didn’t request from the IRS.
  • A notice that someone created an IRS online account without your consent.
  • You find out that more than one tax return was filed using your Social Security number.
  • You receive tax documents from an employer you do not know.

Other signs of identity theft include:

  • Unexplained withdrawals on bank statements.
  • Mysterious credit card charges.
  • Your credit report shows accounts you didn’t open.
  • You are billed for services you didn’t use or receive calls about phantom debts.

What You Can Do

If you discover that you’re a victim of identity theft, consider taking the following action:

  • Notify creditors and banks. Most credit card companies offer protections to cardholders affected by ID theft. You can generally avoid liability for unauthorized charges exceeding $50. But if your ATM or debit card is stolen, report the theft immediately to avoid dire consequences.
  • Place a fraud alert on your credit report. To avoid long-lasting impact, contact any one of the three major credit reporting agencies—Equifax, Experian or TransUnion—to request a fraud alert. This alert covers all three of your credit files.
  • Report the theft to the Federal Trade Commission (FTC). Visit identitytheft.gov or call 877-438-4338. The FTC will provide a recovery plan and offer updates if you set up an account on the website.
  • Please call if you suspect any tax-related identity theft. If any of the previously mentioned signs of tax-related identity theft have happened to you, please call to schedule an appointment to discuss next steps.

Article Submitted by Senior Tax Advisory Group. Call them with any questions at 719-596-4844

Other Articles You May Like

Fraud Checklist: What to Do if Youve Been Scammed

You thought this could never happen to you or your aging loved one: the heartbreaking loss of a hard-earned life savings as a result of a scam.But the growing incidence of older adult fraud is putting many in harms way. Its important to know how to move forward if fraud does occur.Steps to Take if You or Someone You Know is Scammed Close your accounts. If you notice any accounts under your name or that of an aging loved one that have been tampered with or opened without consent, close them immediately. Contact the police. File a report with your local police department. If the theft did not take place in your area, file a report with the police from the area where you believe the theft took place. Get a copy of the police report. You may need that documentation to support your claims to credit bureaus, creditors, debt collectors or other companies. If you are unable to obtain a copy of the police report, be sure to get the report number. Eliminate fraudulent new accounts. If a new account has been opened without you or your aging loved ones knowledge and consent, ask the company with which the account has been opened if it has a fraud department. Initiate a fraud alert. Place a fraud alert on the credit file that has been compromised as well as review the credit report. This will prevent a thief from opening any more accounts in you or your loved ones name. You should contact the major credit bureaus. If you place a fraud alert with one credit bureau, that credit bureau is required by law to contact the other bureaus. Follow-up. After a fraud alert is included in the credit history, you or your aging loved one is entitled to receive a free copy of his or her credit report from each of the credit bureaus. Important Documents for Victims of ScamsThe following are important documents to keep on hand if youve been scammed. If your aging loved one won't be able to keep the originals of some of these important documents, it is important that you make a copy. Police report Identity Theft Affidavit Bills with fraudulent charges Documentation of accounts opened in your name without your consent Copies of letters sent to credit bureaus and creditors Credit bureau contact information: Equifax- 800-525-6285 Experian- 888-397-3742 Transunion 800-680-7289 (U.S.) 800-663-9980 (Canada) If you or your loved one is a victim of fraud, acting quickly is key. Begin working through the fraud checklist above as soon as possible to help minimize the damage. 

CCRC Tax Implications

In the U.S., Continuing Care Retirement Community (CCRC) fees are generally not fully tax-deductible. However, some portions of the fees might be, depending on how they are structured.Heres how it typically breaks down:1. Monthly Maintenance Fees:These fees usually cover services such as meals, housekeeping, maintenance, and security. These are typically not deductible as medical expenses.2. Medical or Health-Related Fees:If part of your CCRC fees goes toward medical care (for example, nursing care or rehabilitation services), that portion may be deductible as a medical expense. The IRS allows you to deduct medical expenses that exceed 7.5% of your adjusted gross income (AGI), but you need to keep detailed records to substantiate the medical portion of the fees.3. Entrance Fees:The upfront, lump-sum entrance fee or buy-in that you pay when you move into a CCRC is typically not deductible. However, if any part of the entrance fee is allocated for healthcare services, that part could potentially be deductible if it meets the criteria for medical expenses.4. Long-Term Care Insurance Premiums:If you are paying for long-term care insurance as part of your CCRC arrangement, those premiums may be deductible as a medical expense, depending on your age and the IRS guidelines for that year.To determine what part of the fees, if any, might be deductible, its a good idea to:Keep records of your payments and the breakdown of what they cover.Consult a tax professional who can guide you based on your specific situation and any changes to tax laws.Tax laws can vary, so its always best to get tailored advice.

Is Assited Living, tax deductible?

Yes, certain costs associated with assisted living may be tax-deductible, but it depends on your specific situation.If the assisted living costs are for medical care, they can potentially be deducted as medical expenses on your taxes. However, there are a few conditions:Medical Care Costs: The portion of the assisted living fees that are directly related to medical care (such as nursing services, personal care, and help with activities of daily living) can be considered a medical expense. These may be deductible if they are deemed necessary medical care.Eligibility: To qualify, your total medical expenses (including assisted living costs) must exceed 7.5% of your adjusted gross income (AGI) for the tax year.Non-Medical Costs: The cost of room and board (such as rent for the living space, food, and housekeeping) is generally not deductible unless it is tied to medical care.Long-Term Care Insurance: If you have long-term care insurance that covers assisted living services, the payments may also be deductible.Its a good idea to consult with a tax professional or accountant who can evaluate your specific situation and help you navigate the tax rules.For more information, contact www.seniorhousingsolutions.net 

Local Services By This Author

Senior Tax Advisory Group

Financial Services 6775 Rangewood Drive, Colorado Springs, Colorado, 80918

"Senior Tax Advisory Group is a company that specializes in serving the retirement needs of anyone over the age of 50. We have helped over 3,000 people in the greater Colorado Springs area since 2002. Our Review and Discovery process helps you discover if your current strategies match up with your future plans. Our proprietary process helps guide you through retirement. Well help you make informed decisions, avoid costly mistakes, lower income taxes, increase your estate size, and we are experts at removing unnecessary risk This proven process helps us create a sound plan based on facts and logic not emotion and opinions. Thats what makes our firm different!"

Senior Tax Advisory Group

Retirement Planning 6775 Rangewood Drive, Colorado Springs, Colorado, 80918

"Senior Tax Advisory Group is a company that specializes in serving the retirement needs of anyone over the age of 50. We have helped over 3,000 people in the greater Colorado Springs area since 2002. Our Review and Discovery process helps you discover if your current strategies match up with your future plans. Our proprietary process helps guide you through retirement. Well help you make informed decisions, avoid costly mistakes, lower income taxes, increase your estate size, and we are experts at removing unnecessary risk This proven process helps us create a sound plan based on facts and logic not emotion and opinions. Thats what makes our firm different!"

Senior Tax Advisory Group

Financial Advisor 6775 Rangewood Drive, Colorado Springs, Colorado, 80918

"Senior Tax Advisory Group is a company that specializes in serving the retirement needs of anyone over the age of 50. We have helped over 3,000 people in the greater Colorado Springs area since 2002. Our Review and Discovery process helps you discover if your current strategies match up with your future plans. Our proprietary process helps guide you through retirement. Well help you make informed decisions, avoid costly mistakes, lower income taxes, increase your estate size, and we are experts at removing unnecessary risk This proven process helps us create a sound plan based on facts and logic not emotion and opinions. Thats what makes our firm different!"