IRS Rejects Your E-filing Because of a Duplicate SSN

Did the IRS Reject Your E-filing Because of a Duplicate SSN?

Filing your taxes each year is annoying, but at least there’s that sense of accomplishment or relief after you file it. That may be true most of the time, but what if you e-file your return just like the IRS prefers, but your return gets rejected? 

There are multiple reasons why this could occur. One of the most common reasons is that one or more Social Security numbers (SSNs) already exist on a filed return for the tax year.

One innocuous reason for this type of rejection is a data entry error on your return. A more ominous reason is that you’re the victim of identity theft. Read on to learn more about how to handle either of these situations and what you can do if someone stole your tax identity. Regardless of which situation applies, you need to act quickly, especially if you’re the victim of tax ID theft. 

The Most Common Reasons the IRS Rejects Your Tax Return Due to a Duplicate SSN 

If the IRS rejects your e-filed tax return because of a duplicate SSN, it’s likely because you (or your tax preparer) made a mistake typing in your SSN, a spouse’s SSN, or a dependent’s SSN. This is particularly true if you prepared your tax return yourself and manually typed in the numbers yourself.

There’s also a chance that your spouse or tax preparer already filed a return without informing you. For example, maybe you hired a tax professional to prepare and file your taxes, but they indicated they might be delayed. So to avoid filing your return late and incurring a late filing penalty, you went ahead and prepared and filed the return yourself. But what you didn’t know is that your tax preparer was able to finish preparing and filing your tax return before you did.

Another potential scenario is if you and your spouse get confused on how you two will file your taxes. Maybe you two are going through a divorce or there’s a miscommunication. Whatever the explanation, you might think you need to file a joint return while your spouse might think each of you will file individual returns for the tax year.

Lastly, there’s the possibility that you’re the victim of tax identity theft. Tax identity theft occurs when someone else, without your authorization or knowledge, uses your personal information (such as your name, SSN, and address) to file a tax return claiming to be you so that they can receive tax benefits they’re not entitled to receive.

Tax identity thieves might file a return in your name and include false information to receive as big of a tax refund check as possible. They’ll do this early in the tax filing season to increase their chances of filing their fraudulent return before you do.

When you finally file your return, the IRS already has a tax return from the thief in their system using your SSN. Eventually, the IRS figures out what’s going on, but by then, the thief is long gone with the money and you’re stuck clearing your name and cleaning up the tax and financial mess left behind. 

What You Should Do If Your E-filed Tax Return Gets Rejected Because of a Duplicate SSN 

Identity theft is the scariest reason for a rejected e-filed tax return, but it’s probably not the most likely explanation. Therefore, you should start with the most probable explanation of a data entry error. If your e-filed tax filing gets rejected because of a duplicate SSN, then the IRS e-filing system will allow you to re-file your return electronically with the corrected information. So the first thing you should do is review the rejected tax filing for errors. It also helps to double-check any other information on the return, like names and dates of birth.

If your rejected filing contained no data entry errors, then you need to accept the possibility that you’re the victim of tax ID theft. In this situation, you may need to complete and file IRS Form 14039, Identity Theft Affidavit. But before you do that, it doesn’t hurt to call the IRS first and explain your situation.

The goal is to see if they can further investigate the cause of your e-filing rejection and provide additional instructions on what you should do about it. If you decide to call the IRS, dial 1-800-908-4490, which will connect you to the IRS Identity Protection Specialized Unit. 

An Overview of IRS Form 14039

Form 14039 is fairly straightforward, at least within the context of completing tax forms. The most important part of this form is Section B, where you explain to the IRS what’s going on and why you think you’re the victim of tax identity theft. There’s not much room on this form for Section B, but you can add to your explanation on another sheet. You should also attach any relevant documents, such as past tax returns, government-issued identification, or screenshots of your e-filing rejection.

You can submit Form 14039 to the IRS in three ways: online, by mail, or by fax. That being said, you’ll probably want to mail it to the IRS because you’ll probably still need to file a tax return before the filing deadline. And with e-filing not being available to you, you’ll need to mail your return to file it. When you do, you can also send in Form 14039 at the same time. 

What If You Don’t E-File?

If you don’t e-file your return, how will you know whether or not someone has stolen your identity? If the IRS receives a tax return filed under your info but the agency believes that it was filed by someone else, they will send you Notice 5071C. This notice explains how to verify your identity.

What You Need to Do if You’re a Tax ID Theft Victim 

As mentioned previously, you’ll need to send in a paper copy of the tax return you’re trying to file, along with Form 14039. Unfortunately, being the victim of tax identity theft doesn’t absolve you of your legal obligation to file required tax returns to the IRS.

You also want to notify the proper authorities. At the very least, you want to report it to the Federal Trade Commission and the IRS by calling 800-908-4490.

Next, you should check your credit reports by going to AnnualCreditReport.com. You’re legally allowed to request one report from each of the three major credit reporting bureaus each year. If you find nothing suspicious, it’s probably a good idea to also place a fraud alert with each of these three credit reporting bureaus. By placing this alert, potential creditors will take extra steps to verify your identity before offering new credit. 

Ways to Avoid Future Identity Theft 

To prevent identity theft (in general), here are some best practices to implement:

• Check your credit history at least once a year by pulling a free credit report (as discussed above).
• Don’t give out your SSN unless you actually need to. For instance, if you have a new job, you’ll need to provide your SSN for tax purposes. But if you’re filling out a medical information form at your doctor’s office, you can probably leave the SSN part of the form blank.
• Use multi-factor authentication whenever possible, particularly with your online financial accounts and important email accounts linked to those financial accounts.
• Don’t click on links or call numbers sent to you by text or email from entities purporting to be the IRS or financial institution. In other words, don’t fall for phishing scams. When in doubt, call the entity directly using a number you pulled from its official website, not provided in the suspicious email, text message, or phone call.
• Use strong passwords for your online accounts.
• Use a good anti-virus and anti-malware app or software on your computer.

To better protect yourself from tax identity theft, you can also create an IP PIN (Identity Protection PIN). The IRS has a special program that gives you a new IP PIN each year that only you and the IRS know and you must provide it when you file your taxes. This makes it almost impossible for an identity thief to file a fraudulent tax return under your name with only your SSN.

It may also be a good idea to create an online IRS account. This will give you ID.me credentials that provide you with access to online tax resources, such as your tax transcript and checking if there are outstanding tax balances you need to pay. 

Need Help Filing a Rejected E-filed Tax Return? 

Having your e-filing rejected by the IRS can be frustrating when you’re so close to finishing your taxes and now realize you have extra work to do. If the above solutions don’t help, or you’d like some assistance completing them, consider contacting the W Tax Group. We can walk you through all of the options discussed in this blog post and also communicate with the IRS on your behalf if that makes you feel more comfortable.

If it turns out you’re the victim of tax identity theft and it’s led to the IRS trying to collect a tax debt from you that they mistakenly believe you owe, we can also help you respond to these tax collection letters and notices. To find out more about what we can do for you, contact us to schedule a free consultation.