February 23, 2017
Area(s) of Interest: Fraud & Abuse Licensing & Regulatory Issues
The California Medical Association (CMA) has received reports from physicians that fraudulent federal income tax returns have been filed using physician names, addresses and social security numbers. In many cases the fraudulent tax return includes the name of an unknown person listed as the physician's spouse. Sometimes, this other name is a prior patient of the physician.
Affected physicians are likely to learn of the scam by receiving a 5071C letter from the IRS alerting them of possible fraud. Physicians may also have received a rejection notification when attempting to electronically file their taxes. This occurs because a return has already been filed using that social security number.
If you learn that your identity has been compromised in this way, act quickly and consider the following steps.
IRS – Contact the IRS through its identity theft website, or by phone at (800) 830-5084, to let officials know you have been a victim of this scam. If you have been unable to electronically file your return this year, you should still file a paper return and attach an IRS 14039 Identity Theft Affidavit to describe what happened.
Also attach copies of any notices related to this issue that you received from the IRS, like the 5071C letter. Be sure to also notify your tax preparer. Verify with the IRS and your tax preparer where to mail your paper tax return, based on the type of return you are filing and your geographic area.
If you have not received a notice from the IRS but believe your personal information may have been used fraudulently or are concerned about whether you may have been victimized, call the IRS Identity Protection Specialized Unit at (800) 908-4490. Additional information is available on the IRS website.
Office of the California Attorney General – Physicians affected should register the identity theft with the California Attorney General. Not only is the Attorney General's website a great resource for identity theft victims, but more information about the victims of this tax scam makes it more likely that an investigation could determine the source of the scam.
FTC – File a complaint with the Federal Trade Commission (FTC). This not only helps the FTC identify patterns of abuse, but the printed version becomes your "identity theft affidavit." That affidavit, along with a police report, constitutes your identity theft report, which you will need for the IRS. The FTC also recommends several other immediate steps to take and provides relevant helpful information on its website.
Police Report – Consider filing a report with the local police in the jurisdiction where you reside. Bring with you all documentation available, including the state and federal complaints you filed. This will likely be necessary if there is financial account fraud as a result of the identity theft. However, if the only fraud is tax fraud, the police report is likely unnecessary unless specifically requested by the IRS.
Social Security Administration – Call the Social Security Administration's fraud hotline at (800) 269-0271 to report fraudulent use of your Social Security Number. To find out if your number is being used for fraudulent employment, you can also request your Personal Earning and Benefits Estimate Statement from the Social Security Administration website or by phone at (800) 772-1213. Make sure to check the report for accuracy.
Financial Accounts – Physicians should also consider taking steps to protect their various financial accounts, such as running a credit report or placing a credit freeze on any existing credit cards. The FTC, Attorney General and DOJ websites referenced above provide several suggestions on how to protect your financial interests in the event of identity theft.
Additional Information – The U.S. Department of Justice website has additional information about identity theft and fraud.
CMA will continue to monitor this fraudulent tax scheme and keep physicians up to date. If you have been a victim, and may have information to help us determine the scope of the situation, please contact the CMA Center for Legal Affairs at (800) 786-4262.