2018 New Tax Changes – I have good news and bad news…

03 Apr 2018 New Tax Changes – I have good news and bad news…

Tax season starts on January 29th – here’s why you should file early.

Good news…the IRS has set a start date.

The IRS says the official start of the 2018 tax season is Jan. 29. If you’re a procrastinator, you have two extra days to file. Returns are not due until April 17. The agency said it expects to get nearly 155 million individual tax returns this year. There are good reasons to not procrastinate in filing your tax return. You don’t want identity thieves to beat you to it.

The IRS has been working with state revenue departments and the tax preparation industry as part of an initiative to tax-related identity theft. Don’t forget that more than 145.5 million Americans had their Social Security numbers and other key personal information stolen when credit bureau Equifax was hacked last year.

The bad news…your info has been compromised, file asap.
In response to its data breach, Equifax has offered free credit monitoring to customers. However, you should not assume monitoring services will prevent identity theft. These programs are not going to help you. While they may alert you to new credit inquiries and accounts, they can’t and don’t monitor for fraudulent tax activity.

Instead, the best way to avoid being a victim of tax identity theft is to file your return as soon as possible. Fraudsters use stolen Social Security numbers to create phony returns and file them early in the tax season. If they aren’t flagged for review by the IRS, the return is processed and a refund issued. Then, when the legitimate taxpayer tries to file his or her return, the system rejects it. The result can be a protracted process in which an affidavit must be completed, supporting documentation provided and a paper return filed.

Other strategies to protect yourself.
Not everyone can file early. Some taxpayers may have to wait for documentation or otherwise be delayed in submitting their return. One option is to use estimated numbers rather than waiting for tax forms. You could file early and then amend if you are worried about the security of your information. The other option is to wait to file, but keep close tabs on your tax record in the meantime.

Some taxpayers also have the option of using an identity protection PIN which offers another layer of security against fraud. Typically, you have to be compromised to get the PIN. In other words, the federal government only issues PINs to those who have already been a victim of tax identity theft.