Protect Your Tax ID From Theft

We all know how important it is to protect our Social Security numbers from identity theft. But are you aware that you should be just as diligent in protecting your business tax ID number? Thieves are on the lookout for information that will help them pretend to be a business that they truly aren’t associated with by getting the tax identification number, business name, address, and often owners names of the company.

They can use this information to apply for credit cards, loans, or even try to set up a payroll company. We’ve actually had many attempts by people trying to set up companies saying they’re the owners, but they really aren’t. And thankfully, due to due diligence, we’ve been able to identify the fraud. But the point of this is that they got the information in the first place. Now some of it is obviously available online, such as a business location and the name, but tax IDs are harder to get.

So it’s important that you know not to email any documentation with your tax identification number. When sending information to your CPA or bookkeeper, be sure you’re using a secure portal or private online folder. Any identification for you personally, or your business, should be protected.

One of the things that we all know too is not to click on those links that come in emails as people can be phishing for information, but often emails come to us that look valid such as from banks or credit card companies.

So, if you’re unsure if something is truly from your bank or credit card company or other financial institution, go directly to their website or give them a call; don’t click on the links. And to protect your data from hackers, make sure you have secure passwords, set up two factor authentication and make sure that you have your computer scanned for any potential issues.

Of course, talk to your IT technician who can help you make sure you have the most secure data on your computers and that you can prevent any hackers from getting information. But again, it’s very important that you realize that your tax ID number can be just as important to someone; similar to your Social Security number.

So, do everything you can to protect your ID. And if you operating under your Social Security number as a sole-proprietor, I recommend you apply for an Employer Identification Number (EIN) so you don’t need to share your tax ID with others who will need to report payments on a 1099.

Being diligent when sharing your sensitive data is extremely important in these times when many thieves are looking to steal your personal or business identity.