Introduction

<p> Did you know that four out of five American taxpayers could have their identities stolen?</p> <p> That&#39;s the truth, according to San Jose, Calif., information-security company ThreatMetrix.</p> <p> &quot;The fact is that about 80 percent of tax filing comes though <a href="http://www.technewsdaily.com/2317-tax-season-e-filing-becomes-the-new-normal.html">e-filing</a>, and that number is going to increase as a percentage, meaning billions of dollars in refunds are at risk,&quot; said Alisdair Faulkner, chief products officer at ThreatMetrix.</p> <p> Last summer, the IRS pulled 2.6 million fraudulent and potentially fraudulent online tax returns. Many involved scammers who&#39;d used stolen <a href="http://www.technewsdaily.com/6967-social-security-number-overuse-risks.html">Social Security numbers</a> to e-file early tax returns in strangers&#39; names &mdash; and then pocketed the strangers&#39; refunds.</p> <p> Such criminals typically opt for small refunds on each return to avoid audits. The key is quantity; the more scams each criminal runs, the more money he pockets.</p> <p> To catch fraudsters, the IRS looks for tax returns filed from overseas computers, for drastic changes in an individual&#39;s income or for other irregularities that differ from the way a regular citizen would file his return.</p> <p> All it takes is a wrong click or a <a href="http://www.technewsdaily.com/2347-how-to-create-remember-super-secure-passwords.html">weak password</a> to give hackers access to an e-filer&#39;s most sensitive financial and personal data.</p> <p> People in states most open to the adoption of e-filing technology &mdash; Iowa, Nebraska and Kansas lead the list &nbsp;&mdash; are most at risk, Faulkner said.</p> <p> &quot;The correlation is that the greater the percentage of adoption of e-tax filing in a particular state, the greater the level of risk,&quot; Faulkner said. &quot;The idea is that a fraudster looks at it as, &#39;I&#39;ve got a smaller barrel with bigger fish.&#39;&quot;</p> <p> <a href="http://www.technewsdaily.com/6741-5-simple-steps-help-prevent-identity-theft.html">Identity fraud</a> as it pertains to electronically filed tax returns is so rampant because the bad guys know it&#39;s a way for them to make some easy money, Faulkner said.</p> <p> Cybercriminals target e-filers because it&#39;s particularly difficult to detect fraud until long after the money is gone. One reason for that is that tax refunds can now be loaded onto a prepaid <a href="http://www.technewsdaily.com/6857-how-to-protect-debit-card-skimming-scams.html">debit card</a>, Faulkner said.</p> <p> &quot;The IRS is no longer [always] mailing a paper check to an address that can be more easily tracked,&quot; he said.</p> <p> Here&#39;s how taxpayers who chose to e-file can offset cybercrime this tax season, according to ThreatMetrix.</p>

Pay attention to suspicious e-mails

<p> Cybercriminals may send you a phishing email message claiming to be from an online tax preparer, but the message is really designed to collect your personal information.</p> <p> These messages could encourage you to file early and send you a link to a bogus tax filing website, Faulkner said.</p> <p> [<a href="http://www.technewsdaily.com/17568-tax-identity-theft-protection.html">7 Tax-Time Identity Protection Tips</a>]</p>

File early

<p> This doesn&#39;t require any technology at all, but it gives fraudsters less of a window for them to get in ahead of you and file a fraudulent tax return using your name, Faulkner said.</p> <p> &quot;The last thing you want to do is wait until the last minute to file your tax return, and then when you submit it, [the system] tells you a duplicate return has been detected, please contact the IRS,&quot; he said. &quot;That&rsquo;s a message you don&#39;t want to be getting.&quot;</p> <p> [<a href="http://www.technewsdaily.com/17501-the-irs-dirty-dozen-tax-fraud-scams.html">The IRS&#39; Dirty Dozen Tax-Fraud Scams</a>]</p>

Have a secure, unique username and password for your tax information

<p> Don&#39;t use the same username and password on an e-filing website that you use for other accounts such as Web-based email or Facebook, Faulkner said.</p> <p> &quot;If one of these accounts gets breached and you use the same username and password for your tax information, that&#39;s problematic,&quot; he said.</p> <p> [<a href="http://www.technewsdaily.com/7663-10-tips-staying-safe-tax-season.html">10 Tips for Staying Safe During Tax Season</a>]</p>

Keep your machine free of malware

<p> Even if you&#39;re aware of the issues with tax fraud and take the proper precautions when you e-file, your computer may do you in. It could contain malware that a bad guy could use to intercept data from a legitimate website.</p> <p> So be sure you update your anti-virus and malware-detection software, not just on your computer, but on any device you plan to use to enter your tax information.</p> <p> &quot;You want to try and reduce the opportunity that the hacker has to use malware that&#39;s on your machine to steal data from you,&quot; Faulkner said.</p> <p> [<a href="http://tax-software-review.toptenreviews.com/?cmpid=ttr-tnd" target="_blank">10 Best Tax-Return Software Services</a>]</p>

Remember that HTTPS is your friend

<p> Be sure any Web form you submit has an &quot;s&quot; after the &quot;http&quot; in the browser address bar, or a padlock icon to the left of the Web address, Faulkner said.</p> <p> Also ensure that the address of each page belongs to a valid IRS or tax preparer&#39;s website.</p> <p> &quot;If you&#39;re on your mobile phone, sometimes fraudsters will use a really long Web address, and in some mobile phones like the iPhone, the Safari browser will only show you as many characters as will fit on the screen,&quot; he said. &quot;What you don&#39;t know is that the end of the Web address ends in .cn, which is China, not .gov or .com.&quot;</p> <p> [<a href="http://www.technewsdaily.com/7687-tax-refund-identity-theft.html">Tax-Day Identity Theft Steals Thousands of Refunds Every Year</a>]</p>

Check out the security of the online tax preparation service

<p> If you&#39;re using an online tax preparer, select one that provides online-banking levels of security, Faulkner said.</p> <p> Does the preparer&#39;s website demand two methods of authentication to log in, such as a password plus a unique code texted to your mobile phone? Does it offer free anti-malware software for your PC as part of the service?&nbsp;</p> <p> If not, it might be best to keep shopping around.</p> <p> [<a href="http://www.technewsdaily.com/3859-irs-dirty-dozen-tax-scams.html">How to Avoid the &#39;Dirty Dozen&#39; Tax Scams</a>]</p> <p> <em>Follow us&nbsp;</em><a href="http://twitter.com/TechNewsDaily" target="_blank"><em>@TechNewsDaily</em></a><em>,&nbsp;</em><em><a href="http://www.facebook.com/TechNewsDaily" target="_blank">Facebook</a>&nbsp;or&nbsp;</em><a href="http://plus.google.com/100300602874158393473/posts" target="_blank"><em>Google+</em></a><em>.</em> </p>

6 Tips for Safely E-Filing Taxes