With the April 15 federal tax deadline looming, your child may be more susceptible to identity theft. It may come as a surprise to some parents to learn that children, like adults, are vulnerable to tax-related identity theft. Learn how to better protect your child from becoming a victim.
For Sale on the Dark Web: An Infant’s Data Set for $300 in Bitcoin
According to reports, cybercriminals have posted advertisements on the dark web selling children’s identities, and, in some cases, the stolen data is being promoted for the purpose of committing tax fraud.
In one instance, criminals advertised data for sale called “infant fullz,” encouraging potential buyers to purchase before tax season. (The term ‘fullz’ is cybercriminal slang for a full identity kit—essentially everything a thief needs to steal an identity, such as name, address, Social Security number, and date of birth.)
What’s the upside for a criminal claiming a dependent as their own? Cybercriminals can purchase an infant’s data set for $300 worth of bitcoin in some cases compared to the $1,000 a thief could potentially gain by claiming a dependent on a fraudulent tax return.
Dependents and Shared Custody
It is common for blended families to unintentionally claim the same child as a dependent, and similar confusion can occur with siblings who claim a parent they care for as a dependent.
According to the IRS, an individual may be a dependent of only one taxpayer for a tax year, even if child custody is shared. The IRS provides tie-breaker rules in the form of an online tool to help taxpayers determine who can claim a dependent.
What to Do if You Suspect Someone Has Falsely Claimed Your Dependent
If you receive an e-filing error based on a dependent dispute, H&R Block provides recommendations on how to resolve it. The IRS also provides a fact sheet for taxpayers who suspect they might be victims of tax identity theft.
Protect Yourself Before Tax Season Begins and Year-Round
Learn how to help better protect yourself and your loved ones from tax-related identity theft. Our whitepaper, Tax-Related Identity Theft: How to Better Detect and Avoid It explains tax-related ID theft and its warning signs, common ways identities are stolen—including the most pervasive impersonation scam in the history of the IRS, steps to help better protect yourself against tax-related identity theft, and what to do if you think you are a victim.