You are probably aware of your own risk of identity theft, and maybe even have taken some precautions to guard your personal and financial data. But what about your children? Identity theft of a minor can go on for years undiscovered. Experts say children represent an emerging market for identity thieves who steal their Social Security numbers knowing that these numbers may not be used for years. Most victims do not even know about it until they are young adults and find their credit rating compromised or are rejected for student loans, jobs, or from renting a place to live.
Researchers at Carnegie Mellon conducted a study on child identity theft, and found that 10 percent of children are victims compared with less than 1 percent of adults. They analyzed more than 800,000 records. The clear message imparted at a recent identity theft conference sponsored by the Federal Trade Commission (FTC) is that this fraud has a systemic financial impact, and that we have an ethical, moral, and legal duty to help our children have a future that they can create for themselves. The Pennsylvania Institute of CPAs offer tips for ensuring the protection of children against the risks and consequences of identity theft.
What are the warning signs that your child’s credit history may have been compromised?
- Your child is denied a bank account or a driver’s license.
- Credit card and loan offers come addressed to your child.
- Collection calls or bills are addressed to your child.
- You receive a notice from the IRS that your child owes income taxes or was claimed as a dependent on another return.
What you can do before and after a possible data breach?
- Check your child’s credit history. There are three recognized companies that can assist with this process:
Unfortunately, checking your child’s credit report isn’t as simple as checking your own. You will have to mail or fax in documentation proving that you are indeed your child’s parent or guardian. This may include copies of the child’s birth certificate and Social Security card, a copy of your own ID, and a list of the last few addresses for the child.
How you can repair the damage
- Contact each of the credit reporting companies and ask them to remove any files that have your child’s Social Security number listed.
- Place a fraud alert with the applicable entity on the credit report.
- File a fraud report with the FTC online or call (877) 438-4338.
Prevention and Protection
- Find a safe location for papers and electronic records.
- Cross-shred documents with personal information.
- Don’t share your child’s Social Security number unless you know and trust the other party.
- Ask at your child’s school or medical office how your child’s information is collected, stored, used, and thrown away.
- Be aware of events that may put information at risk, such as a break in at your child’s school, doctor’s office, or your home.
- Before your child turns 16 get a credit report. If there are errors due to fraud, you will have time to correct the report before your child applies for a job, a loan for tuition, or needs to rent an apartment.
- Teach your children to keep personal information private when they are online. Social networking sites can be a goldmine for identity thieves.
Any taxpayer who believes he or she is at risk of identity theft due to lost or stolen personal information should contact the IRS immediately so the agency can take action to secure his or her tax account. The taxpayer should contact the IRS Identity Protection Specialized Unit at (800) 908-4490, ext. 245. The taxpayer will be asked to complete the IRS Identity Theft Affidavit, Form 14039, and follow the instructions on the back of the form based on the situation.
The IRS has issued guidance for actual or potential identity theft, phone scam, and phishing victims.
- Taxpayer Guide to Identity Theft
- Publication 5027, Identity Theft Information for Taxpayers (PDF)
- Data Breach: Tax-Related Information
- Requesting Copy of Fraudulent Return
- Publication 4524, Security Awareness for Taxpayers (PDF)
- Identity Theft Victim Assistance: How It Works
Access these resources at irs.gov/identitytheft.