With tax season in full swing, identity-theft-related tax fraud has become a hot topic. While taking steps to protect yourself from identity theft is always smart, it's important that you don't get too caught up in the hype. I've received a number of emails from panicked taxpayers who, after watching various news spots on the dangers of identity-theft-related tax fraud, are feeling confused and pressured. Unfortunately, some of the advice making the rounds - while certainly sensational - isn't very practical. Here are five things you need to know about identity theft and tax returns:
Not all data breaches or computer hacks result in identity-theft-related tax fraud.
Filing early doesn't prevent identity theft.
Rushing to file an incomplete return isn't a good strategy.
Not every taxpayer needs an IP PIN.
An IP PIN isn't a one-time fix.