Protect Yourself from Tax Identity Theft: Why an IRS IP PIN Matters
Tax season can be stressful enough without the added headache of identity theft. Unfortunately, every year, hundreds of thousands of taxpayers fall victim to tax-related identity theft — a form of fraud that can delay your refund, compromise your personal information, and cause a major financial mess.
According to the Taxpayer Advocate, “In the 2024 Annual Report to Congress, National Taxpayer Advocate Erin M. Collins discussed how each year, the IRS flags millions of returns for potential fraud. For the 2024 filing season, the IRS suspended processing of over 1.9 million tax returns pending identity verification.” Read more here. But there’s good news: the IRS offers a powerful tool to help safeguard your identity — the Identity Protection PIN, or IP PIN.
What Is Tax-Related Identity Theft?
Tax-related identity theft occurs when someone uses your personal information — typically your name, Social Security number (SSN), and date of birth — to file a fake tax return and claim a fraudulent refund. Most victims don’t even know they’ve been targeted until they try to file their own return and the IRS rejects it, saying one has already been filed under their SSN.
How Does It Happen?
Fraudsters can gain access to your information through data breaches, phishing scams, or other means of identity theft. Once they have your details, they rush to file a bogus return early in the tax season — before you get a chance to file your legitimate one.
By the time the IRS processes your return, your refund might already have been sent to a scammer’s bank account or prepaid debit card.
What Is an IP PIN?
An Identity Protection Personal Identification Number (IP PIN) is a six-digit number issued by the IRS that acts like a second layer of authentication on your tax return. It is known only to you and the IRS, and must be included on your return for it to be accepted.
Even if a criminal has your SSN, they won’t be able to file a return in your name without your unique IP PIN. Without the correct IP PIN, the IRS will automatically reject any return claiming to be from you — stopping fraud in its tracks.
Who Can Get an IP PIN?
Originally, the IRS issued IP PINs only to confirmed victims of identity theft. But now, any taxpayer can voluntarily request an IP PIN — and it’s highly recommended if you want to be proactive about protecting your identity.
How to Get an IP PIN
You can obtain your IP PIN quickly through the IRS’s Get an IP PIN tool at www.irs.gov/ippin. Here’s what you’ll need:
- Your SSN or Individual Taxpayer Identification Number (ITIN)
- Your filing status and mailing address
- An IRS-verified online account (you’ll need to verify your identity through ID.me)
Once enrolled, the IRS will issue a new IP PIN each year. You’ll need to use it on your electronic or paper tax return — and never share it with anyone other than a trusted tax professional.
What If You’ve Already Been a Victim?
If you’ve already experienced tax-related identity theft, the IRS may assign you an IP PIN automatically. You’ll typically receive Notice CP01A in the mail each January with your new PIN for the upcoming filing season.
Suggested Steps to Take:
1. Contact the IRS Immediately:
- Call the IRS Identity Protection Specialized Unit: Dial 1-800-908-4490.
- Complete Form 14039 (Identity Theft Affidavit): This form helps the IRS document the identity theft and initiate an investigation. You can find the form on the IRS website.
2. File a Police Report:
- File a report with your local police department, keeping a copy for your records.
3. Take Additional Steps:
- Contact your financial institutions: Alert your banks and credit card companies about the potential fraud.
- Monitor your credit reports: Check your credit reports for any unauthorized activity and place security freezes.
Final Thoughts
Tax identity theft can have lasting consequences, but taking steps like requesting an IP PIN can dramatically reduce your risk. It’s a simple yet powerful way to keep scammers out of your tax life — and your refund where it belongs: in your pocket.
If you’re unsure whether you need an IP PIN or how to get started, reach out to Noble Pacific Tax Group at 323-498-1040 who can help guide you through the process.
