Tips to Keep Your Tax Records Secure; Protect Yourself from Identity Theft

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If you’re still keeping old tax returns and receipts stuffed in a shoe box stuck in the back of the closet, you might want to rethink that approach.

You should keep your tax records safe and secure, whether they are stored on paper or kept electronically. The same is true for any financial or health records you store, especially any document bearing Social Security numbers.

You should keep always keep copies of your tax returns and supporting documents for several years to support claims for tax credits and deductions.

Because of the sensitive data, the loss or theft of these documents could lead to identity theft and have an economic impact. These documents contain the Social Security numbers of you, your spouse and dependents, old W-2 income and bank account information. A burglar could easily turn your old shoe box full of documents into a tax-related identity theft crime.

Here are just a few of the easy and practical steps to better protect your tax records:

  • · Always retain a copy of your completed federal and state tax returns and their supporting materials. These prior-year returns will help you prepare your next year’s taxes, and receipts will document any credits or deductions you claim should question arise later.
  • · If you retain paper records, you should keep them in a secure location, preferably under lock and key, such as a secure desk drawer or a safe.
  • · If you retain you records electronically on your computer, you should always have an electronic back-up, in case your hard drive crashes. You should encrypt the files both on your computer and any back-up drives you use. You may have to purchase encryption software to ensure the files’ security.
  • · Dispose of old tax records properly. Never toss paper tax returns and supporting documents into the trash. Your federal and state tax records, as well as any financial or health records should be shredded before disposal.
  • · If you are disposing of an old computer or back-up hard drive, keep in mind there is sensitive data on these. Deleting stored tax files will not remove them from your computer. You should wipe the drives of any electronic product you trash or sell, including tablets and mobile phones, to ensure you remove all personal data. Again, this may require special disk utility software.

The IRS recommends retaining copies of your tax returns and supporting documents for a minimum of three years to a maximum of seven years. Remember to keep records relating to property you own for three to seven years after the year in which you dispose of the property. Three years is a time frame that allows you to file amended returns, or if questions arise on your tax return, and seven years is a time frame that allows filing a claim for adjustment in a case of bad debt deduction or a loss from worthless securities.

 As we all know it is Tax Season and we are always here to help! Please contact us today at (877)305-1040 or (310)820-1080 or email us at info@onts9.com for more information and let us do the job for you and make sure you are in good hands.

Ex-IRS Employee Sentenced for Identity Theft and Tax Fraud

A former Internal Revenue Service employee has been sentenced to two years in prison for identity theft and filing fraudulent income tax returns.

George Albright, 57, of Antioch, Tenn., was sentenced last week by a federal judge in in Nashville after he pleaded guilty in May to one count of filing a false tax return and one count of using the identities of others to do so.

Albright was employed by the IRS as a taxpayer service representative from 1995 until March 2012. He admitted that, between February 2008 and January 2011, he used his position as an IRS employee to obtain the names and identifiers of taxpayers from IRS records. He then used this information to file several fraudulent federal income tax returns. Albright directed that the tax refunds from those returns, totaling $9,669.00, be electronically deposited into bank accounts under his control.

In imposing the two-year sentence, U.S. District Judge Todd Campbell noted that Albright, who has no prior criminal history, had engaged in an egregious abuse of the public trust.

“Tax fraud, or any crime committed by a government employee, occupies a high priority for federal investigators and prosecutors in this district,” said U.S. Attorney Jerry Martin in a statement. “Anyone filing a fraudulent tax return and anyone employed in a position of public trust should take note of the prison sentence they risk if they engage in this sort of criminal conduct, even if they have no criminal record. They should also be reminded that there is no parole in the federal system.”

Albright will remain under federal supervision for one year after completing his prison sentence. He was also ordered to forfeit the computer that he used to commit the crimes and will be required to repay the tax refunds he stole.

For more information: www.onts9.com

 

Self-Proclaimed Alabama Governor Sentenced for Tax Fraud

A man who claimed to be the governor of Alabama in its “original jurisdiction” has been sentenced to 10 years in federal prison for tax fraud.

Monty Ervin and Patricia Ervin, owners of Southern Realty in Dothan, Ala., were sentenced Tuesday for conspiring to defraud the United States and tax evasion. After a two-week trial that began Oct. 25, 2011, a federal jury in Montgomery, Ala., convicted the Ervins of one count of conspiracy and three counts of tax evasion. The jury also convicted Patricia Ervin of one count of structuring transactions to avoid bank reporting requirements.

Monty Ervin, 61, was sentenced to 120 months in prison, while Patricia Ervin was sentenced to five years of probation, with the condition that she spend 40 consecutive weekends in jail. In addition to prison time, U.S. District Judge Myron H. Thompson ordered the Ervins to pay $1,436,508 in restitution to the Internal Revenue Service.

In sentencing the Ervins, the court found that Monty Ervin was the leader and organizer of the conspiracy and exercised control over his ex-wife Patricia.

According to prosecutors, the Ervins amassed hundreds of investment properties over the last decade, receiving more than $9 million in rental income. Despite receiving this income, the couple paid no federal income taxes. When confronted by the IRS in 2006, the Ervins proclaimed that they were not United States citizens, and as “sovereigns,” did not consider themselves subject to federal or state law.

The evidence established that Monty Ervin and Patricia Ervin also filed numerous documents in probate court renouncing their U.S. citizenship. In one such filing, Monty Ervin declared himself the “governor” of Alabama in its “original jurisdiction.” The Ervins had a license plate on their vehicle which law enforcement witnesses testified at trial was associated with a “sovereign citizens” organization.

The couple concealed their assets in the property management company from the IRS by placing their investment properties under the names of nominees, referred to as “trustees.” The “trustees” named on property deeds testified that they were not involved in the sale or purchase of the properties and that the Ervins “stamped” their signatures onto official property records.

Patricia Ervin also structured deposits into Southern Realty’s bank account in an effort to evade federal currency reporting requirements.

In addition to hundreds of real estate investment properties, the evidence also showed that the Ervins had amassed beachfront condominium units in their own names, including a $1.3 million unit they paid for in cash. When they were investigated by the IRS, they allegedly transferred those properties into the names of bogus “trusts” and “trustees.” In addition, the government introduced into evidence $350,000 of gold coins said to have been buried in their yard.

The Ervins were indicted by a federal grand jury in Montgomery in February 2011. In March, Monty Ervin was arrested by a U.S. Marshal’s Service Fugitive Task Force in Naples, Fla., with a notebook containing the latitudinal and longitudinal coordinates of an island off the coast of Honduras.

For more information: www.onts9.com