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By Steven Harless, CPA and Donna Holm, CPA, MST –
Of all the things that can be stolen, your identity is probably the most damaging. Identity theft occurs when someone uses your personal information to commit fraud, open accounts or make purchases in your name and brings with it a ripple effect of problems that could take a year or more to sort out. If you have been a victim of identity theft, you will need to repair your credit history and possibly your standing with the IRS.
In order to truly recover from identity theft, you must be diligent and take specific steps.
Generate a Report
• Immediately after the discovery of identity theft, create an Identity Theft Affidavit through the Federal Trade Commission (FTC).
• With your completed Affidavit, file a police report.
• Together, your Affidavit and police report form your Identity Theft Report. You will need copies of this report to send to credit agencies and the IRS.
• Consider speaking with a trained identity theft counselor at the FTC.
Repair Your Credit Report
• Pull your credit report!
• There are three national credit-reporting agencies (Equifax, Experian and TransUnion). You should get reports from all of them. These should be free because you have been the victim of fraud.
• Have the credit reporting agencies place a fraud alert on your file. You will only need to contact one bureau, which will notify the others.
• Note all errors to the various reports.
• Write letters disputing each charge and send certified mail with a copy of your credit report highlighting the error. Do this for each error reporting from each agency.
• Request to have information that was the result of the identity theft blocked from your credit report.
• As problems are resolved, obtain a new credit report. Identity theft can have long-running ramifications, so keep up with your credit report regularly.
Contact Lending Institutions that Issued Credit
• Get in touch with the fraud departments at the companies that erroneously authorized credit to the thief in your name.
• Send these companies the same letters and credit report copies.
• Ask the companies to block fraudulent information, and the company will have to stop reporting the fraudulent information and will not be able to sell the debt for collection.
• Request copies of the documents that were fraudulently used to get credit or make changes in your name. This will enable you to have a copy of the fraudulent signature. The company is required to send it to you within 30 days of your request.
Inform the IRS
• In addition to credit fraud, tax identity theft is also a problem. In this case, the thief has used a taxpayer’s identity and real or falsified W-2s to file fraudulent returns claiming a refund. You may not know this has happened until you file and find out your refund has already been taken.
• If you think someone has stolen your refund or used your social security number, notify the IRS immediately.
• Fill out the IRS Identity Theft Affidavit, Form 14039.
• When you receive correspondence from the IRS, respond right away.
• Even if you have not been the victim of tax identity theft, but your identity has been compromised in another way, it is a good idea to contact the IRS Identity Protection Specialized Unit.
Other Agencies That Need to Know
• Get in touch with the Office of the Inspector General with the Social Security. Administration to report fraud if your social security number has been compromised.
• Contact the USPS if you think that any of your mail has been stolen or rerouted.
• Let the DMV know if you think that someone may be using your identity to obtain a driver’s license or identification card in your name.
• Inform your bank and other lending institutions about your situation in case the thief has been able to obtain your valid credit card and bank account numbers.
As you go through the process, keep records and copies of everything you do. Unfortunately, the burden is on you to clear up the mess, so you will want to make sure you track all correspondence. There are many precautions you can and should take to lesson the likelihood of identity theft.
Steven R. Harless, CPA is Founder and Managing General Partner of Harless & Associates. He also co-founded its affiliated financial services company, Peachtree Capital Corporation.
Donna Holm, CPA, MST is an Associate with Harless & Associates.
222 Lakeview Avenue, Suite 1750 . West Palm Beach, FL 33401
1-561-666-4200 . HarlessandAssociates.com
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