Synthetic ID Theft
Synthetic identity theft is a new version of identity theft. In traditional ID theft, the thief steals all of the personal information of one person to create a new identity. However, with synthetic ID theft, a thief steals pieces of information from different people to create a new identity. For example, the thief may steal one person’s social security number, combine it with another person’s name, and use someone else’s address to create a brand new identity. The thief can then use this fraudulent identity to apply for credit, rent an apartment, or make major purchases.
Unfortunately, synthetic ID theft is difficult to detect because the fraud isn’t directly tied to just one person. Fraud alerts and monitoring services would not be able to stop or prevent these scams. Also, children’s social security numbers are often targeted in these frauds, because no one would be checking their credit scores until they are much older.
While you cannot prevent synthetic ID theft, you should still get copies of your credit report to check for accounts you did not open. Also, contact the credit reporting agencies to ask if there is a fragmented file (a sub-account that uses your social security number but not your name) attached to your main credit file. If this is the case, you may be the victim of synthetic identity theft. Report all cases of identity theft to the Federal Trade Commission.
Tax-Related Identity Theft
Tax-related identity theft occurs when someone uses your stolen Social Security Number (SSN) to get a tax refund or a job. These tips can help you prevent and report tax identity theft:
To prevent tax identity theft, be wary of any Internal Revenue Service (IRS) letter or notice that states:
- More than one tax return was filed using your SSN.
- You owe additional tax, you have had a tax refund offset, or you have had collection actions taken against you for a year you did not file a tax return.
- IRS records indicate you received wages from an employer unknown to you.
The IRS does not initiate contact with a taxpayer by sending an e-mail, text, or social message requesting personal or financial information.
Dealing with Tax-Related Identity Theft
If you suspect someone used your Social Security Number (SSN) for a tax refund or a job—or the IRS sends you a letter or notice indicating a problem—take these steps:
- File a report with the Federal Trade Commission (FTC). You can also call the FTC Identity Theft Hotline at 1-877-438-4338 or TTY 1-866-653-4261.
- Contact one of the three major credit agencies to place a fraud alert on your credit records:
- Contact your financial institutions, and close any accounts opened without your permission or tampered with.
- Respond immediately to any IRS notice; call the number provided. If instructed, go to the Identity Verification Service.
- Complete IRS Form 14039, Identity Theft Affidavit; print, then mail or fax according to instructions.
- Continue to pay your taxes and file your tax return, even if you must do so by paper.