Wondering Why ODJFS Sent You Form 1099-G?
Fraud is on the upswing. Bad actors are targeting email, they’re infiltrating cell phones, they’re tampering with our mailboxes, they’re basically lurking in every corner of our lives just waiting for us to let our guards down. Stay vigilant out there, friends.
We recently received a call from a client who reported that their spouse opened their mailbox and found a 1099-G form from the State of Ohio for unemployment benefits waiting for them. The couple found this curious as the recipient of the tax form was currently enjoying their 15th year of retirement. Clearly, something wasn’t right. After a little investigation, their worries were confirmed – somebody fraudulently filed for unemployment benefits on behalf of our client’s spouse and the 1099-G form was the red flag.
Unfortunately, this is not an isolated incident. In fact, we’ve had calls from others who have been targeted (or who have stories of others who have been targeted) in a similar fashion.
Listen to episode 266 of unsuitable on Rea Radio, “How Are They Stealing My Information? Fraud Protection 101”, Rea & Associates’ award-winning podcast to learn more.
What To Do If You Suspect Your Personal Information Has Been Stolen?
The Ohio Department of Job and Family Services (ODJFS) provided information for those who suspect that their personal information has been stolen on their website. This is particularly helpful if you found yourself on the receiving end of a 1099-G tax form for unemployment benefits you didn’t request or receive.
Step 1: Report It
The first step to take when you suspect that you have been a victim of identity theft pertaining to unemployment benefits is to access the online form provided by ODJFS. This form should be completed and submitted as soon as possible. Once the completed form is received, ODJFS will process it and proceed with an investigation. If necessary, the agency will also issue a correction to the IRS pertaining to 1099-G that was issued.
Step 2: Contact Your CPA
Don’t allow the ODJFS’ investigation to delay filing your state and federal tax returns. Instead, contact your CPA and work with them during the filing process. The sooner you can bring your CPA into the discussion, the better as criminals continue to use stolen information to file fraudulent tax returns. Oftentimes, a taxpayer won’t realize that they’ve been a victim until they go to file their taxes with the IRS only to realize that their taxes have already been submitted and your refund was already deposited into the criminal’s bank account.
Now, with regard to the fraudulent unemployment benefits, per the Ohio Department of Taxation (ODT), taxpayers do not need to include unemployment benefits they didn’t apply for as income on federal and state income tax returns. Furthermore, “you do not need to have a determination from ODJFS on your ID theft claim or a corrected 1099-G to file your federal and state income tax returns. However, you should continue to pursue a corrected 10990G from ODJFS after your returns are filed to avoid a future audit by the IRS or ODT.”
Step 3: Prevent Future Identity Fraud
There are a lot of great measures you can take to prevent becoming a victim of identity fraud moving forward. Here are some key tips you should keep in mind at all times:
- Keep your Social Security card in a secure location – this does NOT mean inside your wallet.
- Use discretion when it comes to sharing your Social Security Number, or your birthday, or your bank account number with anybody.
- Collect your mail every day. And when you can’t, place a hold on it to avoid key pieces of your personal identification from falling into the wrong hands.
- Use proven security features, including two-factor authentication, firewalls, VPNs, etc.
- Review your credit card and bank account statements regularly and watch for unauthorized transactions.
- Create complex passphrases. Check out this article to learn how to craft the ideal passphrase.
- Check your credit reports annually. This is a great way to ensure that additional accounts weren’t opened in your name without your knowledge.
When it comes to protecting your identity, you are going to be your own best advocate. Exercise best practices, remain vigilant, and report your suspicions of identity fraud to the authorities. If you would like to learn more about identity theft prevention or how to protect yourself or your organization from fraud, contact us today.
By Lisa Beamer, CPA (New Philadelphia office)