Special analysis: Identity theft, W-2s and you — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily

Special analysis: Identity theft, W-2s and you

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in Office Management,Payroll Management

W-2s are chock full of information every identity thief needs: Social Security numbers (SSNs) and Employer Identification Numbers (EINs), neither of which you can truncate, plus employees’ and employers’ names and addresses. This should give you pause, now that employees have their 2014 W-2s in hand, and you’re making final preparations to file those forms with the Social Security Administration (SSA).

Hello, this is the IRS calling. There are two types of W-2-related identity theft:

  • Employees’ SSNs are stolen and bogus 1040s are filed claiming refunds
  • Your EIN is stolen, fake W-2s are filed and fake 1040s based on those W-2s are filed, again, claiming refunds.

Either way, a discrepancy in your tax accounts arises once the IRS matches those phony W-2s to your legitimate 941s. Penalties follow. Although penalties can be abated, you will spend a substantial amount of time and effort working with the IRS to untangle everythi...(register to read more)

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