Imagine having your tax return rejected because someone already filed one in your name. It happened to one man, and if you think it won't happen to you, think again. Over a two-year period, the IRS stopped nearly 15 million suspicious returns. It's a number that has jumped by 60 percent from last year.
Last week, Seth Rouse filed his tax returns electronically, as he has for 11 years through Turbo Tax. Somehow, hackers had gotten hold of all his information and filed a fake return before he did.
"I feel like I'm on an island, on my own," said Rouse.
After filing, he got e-mails from the IRS and the state, saying his filings were rejected. Somebody using his information had filed already.
"Cyber attacks just happened. But we've had other attacks in the past, where they've gotten names, Social Security information, of not just individuals, but children. They can claim them as a dependent on their own return," said Jon O'Hara from the Better Business Bureau.
In fact, Turbo Tax was recently hit with a wave of bogus e-file returns last week. They shut down the service after finding an increase in suspicious filings, but restored it.
The day after Rouse found out his filings were rejected, he strangely got a refund check from the IRS. It seems the not-so-bright hackers who had already filed in Rouse's name, had apparently forgotten to have it sent to them.
"Somebody screwed up and it sounds like the bad guys screwed up," says ID theft expert William Kresse.
Kresse says tax refund theft is a growing problem amounting to billions of dollars each year.
"I'm going to buy a paper shredder now, I can tell you that. I'm shredding everything. I'll shred my underwear if I have to," says Rouse.
Kresse, who's also known as "professor fraud" says to minimize your chances of cyber crooks robbing you of your refund, file early before the crooks can, the earlier the better.
If you are filing online, you want to make sure you are on a secure site. For example, if you are in a coffee shop somewhere, filing your taxes on an open Wi-Fi gives somebody the opportunity to steal your return.