IRS Issues Guidance For Pandemic Identify Theft Victims

The IRS has recommendations for taxpayers whose identities were stolen by fraudsters claiming unemployment benefits in other peoples’ names during the pandemic.

Victims — and officials have said they fear there are many — already are discovering the crimes when they review 1099-G forms detailing paid benefits for tax purposes.

“This is a critical issue that is plaguing labor departments across the United States involving local, state, and even international criminals at times,” Georgia Labor Commissioner Mark Butler said in a statement, CNBC reported.

In recently published guidance, the agency directed victims to: “Contact issuing state agency to report fraud… Ask state agency to issue a corrected 1099-G… File an accurate federal tax return reporting only income received, even if a corrected 1099-G has not yet been received… Follow Federal Trade Commission recommendations for identity theft.”

Also, according to the IRS, victims should file identity theft complaints with the National Center for Disaster Fraud.

The agency stated in the guidance that victims only should file an affidavit reporting the identity theft to federal authorities “if the taxpayers’ eFiled tax return is rejected because a duplicate return with their Social Security number is already on file or if the IRS instructs them to [do so].”

The agency’s last piece of guidance on the topic was to consider signing up for a PIN that will be required in certain interactions with the agency.

In an attempt to crack down on fraud, Congress, in the new round of stimulus approved in early January, included provisions requiring that applicants for some unemployment benefits prove their identity before receiving benefits.

Unemployment benefits are administered by states. Florida’s response to fraud included measures implemented in a mobile app used by individuals seeking assistance.