Is There Any Danger in Giving Out My Tax ID Number?
You should never give out your taxpayer identification number without a good reason. Your tax ID is the same as your Social Security number, and identity thieves can wreak all kinds of havoc if they have access to it. If someone does start exploiting your number, there are steps you can take to protect yourself.
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History
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The federal government began issuing Social Security numbers in 1936. At the time, the government stated the numbers would never be used except within the Social Security program itself. As government record-keeping and computerization increased, however, the number became a universal identifier for multiple government programs. The Internal Revenue Service began using Social Security numbers as taxpayer ID numbers in 1961.
Effects
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Your taxpayer ID/Social Security number may be used in many places besides federal files, including employee files, medical records, bank accounts, credit reports and college records This makes number tremendously useful to identity thieves, who can work a variety of scams, such as opening up false accounts in your name or getting access to your bank account.
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Types
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Even if you don't give out your number freely, there are multiple methods thieves can use to obtain it. They can search through your trash for your taxpayer ID/Social Security number on papers you've thrown out and use this information to contact banks or utility companies posing as you to obtain information, or they may use "phishing" emails supposedly from banks or credit-card companies threatening to close your account if you don't provide personal information.
Identification
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To spot identity theft, the FTC recommends you check your credit card bills, bank statements and other accounts every month, and go over your credit report once a year. You can obtain free credit reports from the major credit bureaus on the Annual Credit Report website. If you find credit card purchases you didn't make or accounts in your name that you never opened, identity thieves may be at work.
Prevention/Solution
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If you think your identity has been hacked because someone has stolen your tax ID/Social Security number, contact the credit bureaus and put a fraud alert on your accounts. Once the alert is in place, the bureaus will inform any business making a credit check that it must make an effort to determine the person it's dealing with is really you. You should then contact any businesses of existing accounts the thief has opened in your name and complete the institutions' fraud-resolution procedures to close down those accounts.
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