Your Money: An innocent start to identity theft
No doubt, identity theft has been in the news for a few years now, and it’s the fastest growing crime in America. In the past few weeks, I’ve had some eye-opening experiences I think are worth sharing. If you’ve had any experiences of your own, please send them along if you don’t mind me sharing!The first shocker for me was waking up one morning and realizing someone had gone through our trash the night before. While this is a legal practice – and at the end of the day I’m happy that our trash could turn into someone’s treasure – it’s still a little disconcerting when you realize your personal space has been violated. A situation like this makes me rethink how I treat my personal documents. How carefully are you watching yours?The next eye-opener involved a local property management company who typed in an incorrect tax ID # for a rental property. As a result, a 1099-MISC reporting rental income was issued with the wrong person’s tax ID# on it! That poor individual will file his tax return, and in a few months, the IRS will contact him/her and say they are under-reporting their income. That person will then have to fight with the IRS to not have to pay the tax bill on the missing income.This reminded me of a prior experience I had helping a client who received a W-2 with someone else’s income reported on it. While standards have improved for identity checks, it’s not unheard of for companies to hire employees with fake ID’s and then issue W-2s using those fake numbers. Whether this is the company’s fault for not checking properly or the employee who presented the fake ID, it almost doesn’t matter. It still has a very negative effect on the individual who receives the incorrect document, and unfortunately they are the ones left to fight the IRS and incur the expense of the accountants and attorneys they sometimes need to defend themselves.Do I have any advice on simple steps to prevent identity theft? Of course! I recommend that you get online access to your bank and credit cards and check them at least weekly, if not daily. When you use software like Quicken, you can update your accounts daily in just a few seconds, and you’ll notice right away if any suspect charges appear on your accounts. You should also order copies of your credit reports quarterly, or subscribe to a credit monitoring service. This way, you are notified pretty quickly if someone is using your Social Security number to gain access to credit.Sadly, identity theft can hit anyone at any time. You should always do what you can to protect yourself and be diligent about your financial fingerprints. Michele Knight, owner of Knight Accounting & Technology, is a CPA and QuickBooks ProAdvisor based in Dillon. For more info and to contact her, visit http://www.cpamichele.com.
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