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IRS Identification Verification Letters – A Scam or For Real?

By Paul J. Carroll, CFP®August 26, 2020December 1st, 2023Videos

A lot of our clients have been receiving these IRS Identification Verification notices. Some of these clients have even paid taxes and are wondering “Is this for real; is this fraud?” And if you get one, what should you do about it? So if you get one of these letters and you are owed a refund, you need to ask CPA if the letter appears legit. You can do it online, and we’ll include a link at the bottom of this blog post. Or you can call the number on the letter. Something you need to know is the IRS will never call you. So if you have received a call from the IRS, you can pretty much assure it’s fraud. And if you are concerned about fraud, with the letter, another thing you can do is you can Google the phone number that’s on the letter. If it’s the right number, it should show up as such. So why are people receiving these? Well, first everything’s changed with COVID. The timing of returns are different. There’s changes of address, there’s changes in the number of dependents, there’s a significant change in, say, the amount or the refund due, or there’s a failure to direct deposit the refund. There’s all sorts of reasons why the computers are flagging these letters.

So as you can imagine, with all of the things that have been happening, a lot of these flags have been triggered. But what if you’re owed money? Why are you getting this? So there’s about three scenarios that can exist here. First, you filed and you’re owed money. Obviously you need to go through the steps. Unfortunately, your CPA cannot do this – not without a power of attorney – and be ready for an excruciating wait on hold. Maybe two hours, maybe more. Have your popcorn and a movie, put the thing on speakerphone, or find an assistant to do it for you. And also be emotionally charged and ready for the call to drop after a couple of hours. This is infuriating, but you got to do it if you want the refund. Now another scenario is you filed your taxes and you wrote a check, and you may think “why on earth do I care?” Well, if you don’t submit this, then they will reject your tax return, reject your payment, and now you’re late and you will get late penalties. So even in that scenario check with your CPA; see if it looks legit.

Now the third and final scenario, which is really probably the worst, is you haven’t filed a return and they’re asking for ID verification. That means someone else filed one for you, and there is almost certainly some form of fraud going on. Again, you need to take action. If you haven’t filed and it’s not fraud, then that’s a fishing expedition. This is probably a false phone number. They’re looking for your information. Unfortunately, in this environment with what’s going on with COVID, fraud has reached pandemic scale.

There is one way you can help yourself both now and in future years. And that is by getting a special ID verification pin. This basically is a verification methodology that the IRS loves to see you use, whereby they give you a code, and if you have the right code everything else is pretty much taken care of most of the time. But regardless of whether or not you filed your return, whether or not you owe money, you need to check your CPA. See if the piece of paper looks real. Make the phone call or have someone else do it for you. Verify your identification. There’s no good outcome if you fail to respond to a legitimate request from the IRS. Frustrating as it is, at least when you get this letter, you’ll have a heads up of what to do next. Thank you.


Sample Letter:


Identity Verification for IRS Letter Recipients – IRS

Get an Identity Protection PIN – IRS

Founder & CEO at Avion Wealth

Paul is the founder and CEO of Avion Wealth, LLC. He leads a team of wealth managers in building and executing financial plans for high net worth individuals and families. Contact Avion Wealth to speak with a financial advisor.