Taxpayers who experience tax-related identity theft may wonder when they should file a Form 14039, Identity Theft Affidavit.
In the vast majority of tax-related identity theft cases, there is no need to file the Form 14039 affidavit. The Form 14039 affidavit should be filed if the taxpayer attempts to file an electronic tax return and the IRS rejects it because a return bearing the taxpayer’s Social Security number already has been filed. Or, it should be filed if the IRS instructs the taxpayer to do so.\
In most cases of tax-related identity theft, the IRS identifies a suspicious tax return based on hundreds of processing filters and pulls the suspicious return for review. The IRS will send a letter to the taxpayer and will not process the tax return until hearing back from the taxpayer.
In this situation, the taxpayer will receive Letter 5071C, which will ask them to use an online tool to verify their identity and tell the IRS if they filed the return in question. A variation, Letter 4883C, will ask the taxpayer to call the IRS to verify their identity and tell the IRS if they filed the return. For those who have been a victim of a data breach, they may receive Letter 5747C and be asked to verify their identity in person at a Taxpayer Assistance Center.
Taxpayers file the Form 14039 to inform the Internal Revenue Service that they think they may be a victim of tax-related identity theft. They are having specific tax-related issues, such as not being able to file electronically because a tax return with their SSN already has been filed. (First make sure there are no other common issues, such as a transposed SSN or a dependent filing a separate tax return.)
Completing Form 14039, attaching it to a paper tax return and mailing it to the IRS is the way to inform the IRS that the taxpayer may be a victim. The IRS will then identify the fraudulent return and, after an investigation, clear the account and process the paper tax return. See IRS Identity Theft Victim Assistance: How It Works.
