If you’ve ever worried about tax fraud, you’re not alone. Tax fraud can happen to anyone, and it’s a real headache. Maybe you found out someone used your Social Security number. Maybe you noticed a strange tax return filed in your name. Now, you’re wondering: what happens if you use tax software after fraudulent activity? This question matters because the wrong move can make things worse. Tax software is supposed to make life easier, but after fraud, it can get complicated fast. Here’s what you need to know if you’re thinking about using tax software after you’ve been hit by fraud.
1. Your Return Might Get Rejected
If someone has already filed a tax return using your information, the IRS will flag your Social Security number. When you try to file your own return through tax software, you might get an error message. The software will tell you that the IRS has already received a return with your details. This is a clear sign of tax fraud. At this point, you can’t just keep clicking “submit.” The IRS won’t accept two returns with the same Social Security number. You’ll need to take extra steps to fix the problem.
2. You’ll Need to Prove Your Identity
After fraud, the IRS wants to make sure you’re really you. If your return is rejected, you’ll likely need to verify your identity. Tax software can’t do this for you. The IRS might send you a letter asking you to call or visit a local office. Sometimes, you’ll need to use the IRS Identity Verification Service online. This process can take time and patience. You’ll need documents like your driver’s license, passport, or other ID. Until you prove who you are, your tax return will be on hold.
3. Filing Electronically May Not Be an Option
Tax software is built for electronic filing. But after fraud, e-filing might not work. If your Social Security number is flagged, the IRS will block electronic returns. The software will tell you to print your return and mail it in. This slows everything down. Paper returns take longer to process, and you might wait months for your refund. It’s frustrating, but it’s the safest way to make sure your real return gets to the IRS.
4. You’ll Need to File an Identity Theft Affidavit
If you suspect or know you’re a victim of tax fraud, you need to file IRS Form 14039, the Identity Theft Affidavit. Most tax software can’t do this automatically. You’ll have to download the form, fill it out, and mail it with your paper return. This tells the IRS you’re a victim and need help. The IRS will then investigate and put extra protections on your account.
5. Your Refund Will Be Delayed
After fraud, don’t expect a quick refund. The IRS needs time to sort out what happened. They’ll compare the fraudulent return with your real one. This can take weeks or even months. Tax software might show you an estimated refund date, but it won’t be accurate. The IRS will contact you if it needs more information. Be patient and keep checking your mail and IRS account for updates.
6. You Might Need to Contact the IRS Directly
Tax software is great for simple returns, but it can’t solve fraud. If you run into problems, you’ll need to call the IRS. Be ready for long wait times. When you get through, explain your situation clearly. Have your documents ready, including your last tax return, ID, and any IRS letters. The IRS can walk you through the next steps and tell you what to do next. You can also check the Federal Trade Commission’s identity theft resources for more help.
7. You’ll Need to Watch for More Fraud
Once you’ve been hit by tax fraud, you’re at higher risk for more problems. Criminals might try to use your information again. The IRS might give you an Identity Protection PIN (IP PIN) to use on future returns. This is a six-digit number that helps stop fraud. Tax software will ask for your IP PIN if you have one. Never share this number with anyone. Keep an eye on your credit reports and watch for suspicious activity.
8. You May Need to Update Your Tax Software Account
If you used tax software before the fraud, your account could be at risk. Change your password right away. Turn on two-factor authentication if it’s available. Check your account for any strange activity, like returns you didn’t file. If you see anything odd, contact the software company’s support team. They can help secure your account and guide you on what to do next.
9. You’ll Have to Be Extra Careful Next Year
After fraud, tax season gets more stressful. Start early next year. Gather your documents and file as soon as you can. The sooner you file, the less chance a criminal has to file before you. Use your IP PIN if you have one. Keep your tax software and computer updated to protect your information. Stay alert for phishing emails or fake IRS calls.
10. You Might Need Professional Help
Sometimes, tax fraud gets complicated. If you feel overwhelmed, consider talking to a tax professional. They can help you file your return, deal with the IRS, and protect your information. Some tax software companies offer audit support or identity theft help, but it’s not always enough. A professional can give you peace of mind and make sure you’re doing everything right.
Moving Forward After-Tax Fraud
Using tax software after fraudulent activity isn’t simple. You’ll face roadblocks, delays, and extra steps. But you can get through it. Stay organized, follow the IRS’s instructions, and protect your information. The most important thing is to act quickly and not ignore the problem. Tax fraud is stressful, but you can take control and get back on track.
Have you ever dealt with tax fraud or had trouble using tax software after identity theft? Share your story or tips in the comments below.
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