The IRS issued a warning to small businesses to be wary against increased identity theft attempts as the IRS identifies an increase in the number of fraudulent business tax form filings.
According to the IRS, identity thieves for a long time have used stolen Employer Identification Numbers to create fake Forms W-2 that have been filed with fraudulent individual tax returns. The thieves also used EINs to open lines of credit and get credit cards. Now, thieves are expanding into filing fraudulent business tax returns.
Employers should look for the following warning signs of identity theft:
- Extension to file requests are rejected because a return with the Employer Identification Number or Social Security number is already on file;
- An e-filed return is rejected because a duplicate EIN/SSN is already on file with the IRS;
- Receipt of 5263C or 6042C Letters;
- An unexpected receipt of a tax transcript or IRS notice that doesn’t correspond to anything submitted by the filer;
- Failure to receive expected and routine correspondence from the IRS because of a change in address.
Any of these signs should raise a red flag for the employer to investigate.
