Tax Return Identity Theft Spikes, IRS Says

A Broken Arrow couple has a warning now that tax time is here. Someone filed tax returns using their names and social security numbers.

The IRS says refund fraud is a big problem right now.

Elven and Carole Lindblad were pretty shocked last year when they went to file their taxes, only to find out they'd already done it.

Someone had gotten their social security numbers and filed a fake return.

"Anger, frustration, sadness,” Elven said. “What did I do or my wife do to you that was so vile, so evil, that you'd want to violate who we are?"

They filled out all the required paperwork, but it can still take six to 18 months for the IRS to sort it out and until they do, you don't get your refund, and the feds don't always talk to the state tax commission.

"They sent us a letter saying we owed $2,900, then two days later, we get a letter from the IRS confirming, yes, you are the victims of identity theft,” Elven said.

And good luck talking to a person at either agency.

"It's been a massive spike,” CPA Paul Hood said.

Hood says it all started after the Affordable Care Act was passed, because that requires health insurance companies to share information with the IRS and vice versa.

"This is very unique,” Hood said. “Typically, you see identity theft in one or the other, but I see letters coming from the IRS, both husband and wife, their correct address and social security numbers. It goes beyond hacking and getting just a social security number."

If it happens to you, file a police report, go to IRS.gov and fill out form 14039 and send it in, contact your banks and put an alert on your accounts with the three credit bureaus. If the IRS believes you're a victim, they'll issue you a special PIN number to use when filing your taxes the next year.

The IRS is considering waiting to pay refunds until they can match your W-2 to your return, but right now, the law is set up so they pay first and ask questions later. The IRS says it currently has 3,000 employees working on nothing but identity theft.