Stacey Buckman has her financial ducks in a row.
She’s a small business owner, does her own taxes, regularly checks her credit report and knows how the ins and outs of the Internal Revenue Service’s 1040 form.
So, she knew something wasn’t right when she filed her taxes online March 30 and almost immediately received an email stating they’d already been filed just hours earlier.
It didn’t take long for Buckman to discover an identity thief had used both her and her husband’s Social Security numbers to file fraudulent income tax returns in their names, costing the IRS thousands of dollars and essentially putting the Buckmans on financial alert for the foreseeable future.
“It can happen to anyone,” Buckman said. “You have no idea. It’s so random.”
Buckman and others who have reported income tax identity theft in southwest North Dakota are part of an increasing statistic, North Dakota Tax Commissioner Ryan Rauschenberger said.
Rauschenberger said in 2015 his office caught nearly 1,000 instances of income tax identity theft, which would have totaled to nearly $1.3 million in fraudulent refunds.
“It’s a major issue for our state and for many, many other states,” Rauschenberger said, adding this type of identity theft is on the rise.
He said North Dakota is part of a consortium of states that have organized in an effort to stop this type of fraud.
The U.S. General Accountability Office estimated that in 2013, the IRS paid $5.8 billion in fraudulent refunds because of identity theft, with more fraudulent payments likely going undetected or unreported.
Anthony Willer, of Dickinson, said he received a letter from Rauschenberger’s office last Saturday requesting verification of the W-2 forms used in filing his family’s taxes before he had even filed.
Like Buckman, Willer said he planned to file his taxes later than normal this year because he had been waiting to receive various tax forms.
“Something wasn’t matching up with the system as far as the tax amounts that were paid,” Willer said.
He said the tax commissioner’s office flagging his filings as affected by fraud helped him report the identity theft. Still, Willer said he spent an entire day making sure his family’s identities, as well as their finances and credit history, were secure.
“It’s a huge inconvenience,” he said.
Rauschenberger said it’s also important to report identity theft to the state attorney general’s office consumer protection department.
Buckman and Willer each reported their identity theft to area law enforcement, as a police report is a required part of clearing a person’s name after their identity has been stolen or compromised, Dickinson Police Capt. David Wilkie said. That police report then shows up on a person’s credit history for seven years, with it serving as a note to future creditors and to help keep their credit scores unaffected by the fraud.
Wilkie said it seems that random people are being targeted for income tax identity theft.
“It’s tough to say how they’re picking their victims,” Wilkie said. “If we knew that, it would make it a lot easier to warn people. It kind of seems like age has something to do with it. Although I have heard of young people getting their identities stolen too.”
Most of the incidents occur late in the tax season, Rauschenberger said.
Monday is the deadline for Americans to file their taxes.
“The key is you should file early,” he said. “Don’t wait until the last minute. That’s one of the major reasons we push that you should file early.”
Buckman said she typically files her family’s taxes in February or early March. She also always files with her husband, David, as head of the household. She learned that the identity thief had filed using her as the head of the household instead, which became an automatic red flag for the IRS.
How their Social Security numbers were compromised, however, remains a mystery.
“There’s really no way of knowing,” Buckman said. “In speaking with TurboTax, the IRS and law enforcement, they’re saying that in a majority of these cases, it’s being done by someone overseas.”
Like Buckman, Willer said he’s knowledgeable about taxes and never expected his identity to be stolen through his filings.
“You think it’s something that takes place somewhere else. Not in Dickinson. Not in a small area,” Willer said. “It’s quite common unfortunately. Too common.”
As they move forward, both Buckman and Willer said they’re going to stay vigilant with their finances and check their credit reports and bank accounts often. Buckman said she may even go as far as attempting to request a new Social Security number to prevent future identity theft.
“My biggest takeaway from this is to make sure I file early,” Buckman said. “File as early as absolutely possible to prevent someone else from having the opportunity to compromise you and put you in a bad situation. Because God knows where this really will end?”
Dustin Monke 