Years ago people exchanged phone numbers, addresses, post cards, and letters. They found ways to stay in touch with one another. Long distance telephone calls were once commonplace between old friends, long lost relatives, and former acquaintances. How life has changed. Now old friends are just an email away, a comment on a blog from reconnecting with us.

When your children ask you about the people you grew up with and you remember your old friendships, the adventures you and your buds had after school, during the summer months, and in college — don’t you wonder what became of those people who were once such big parts of your life? Don’t you wish you could just call them up and get together again?

One of the most amazing things about life today is the Internet. Through this technology we create databases, build online profiles, and leave our resumes for potential employers to look at without having to invest in expensive paper or projects. Computer technology has been criticized for separating people but it really does offer us the means to reconnect.

Let’s say you have an old friend named Jim Thomas. If he had an interest in film and television you might be able to find him on the Internet Movie Database. Wouldn’t that be something?

Or maybe you can find your old friend Charlie Jones just by searching online phone directories. Many people are still listed in these directories and there might not be so many that searching for old friends is too time-consuming.

You could even look in online encyclopedias for old friends like Dennis Tamburo. Not that they will be in the encyclopedia but you never know. It’s worth a try.

The point is that we have fond memories of old friends, distant relatives, and people we once worked with. We don’t have to slowly forget them. We can reconnect with friends from the past and make new memories. Maybe. Maybe they are no further away than a few searches on your computer.

If your identity is stolen, your finances can quickly become a nightmare. A less obvious problem is the effect identity theft can have on your taxes.

Identity Theft

Generally, thieves steal your personal data for the purpose of running up credit card charges or opening and abusing new accounts. A developing trend in the identity theft field concerns schemes impacting your taxes.

Selling Social Security Numbers

Identity thieves have created a new line of business - selling your social security number. Who would want to buy it? The list is surprising long, but undocumented workers, individuals with bad credit and people trying to obtain a new identity lead the list. This can create a huge problem for you since any income paid to those individuals is reported to the IRS as being paid to you. This results in the IRS having inflated income numbers and, often, audits when you “under report” your income.

With the creation of the Real ID Act, better known as the National ID Card, things will only get worse. Under the Act, all workers will be required to submit social security numbers to obtain jobs. With our leaky borders, there will be a high demand for your social security number.

False Tax Filings

It doesn’t take much to file a tax return. What’s to stop an identity thief from filing one under your name to generate a refund? Nothing. To generate the maximum refund, you can be all kinds of frivolous deductions will be claimed. After all, it will be you that has to attend the audit.

What Can I Do?

If you receive a notice from the IRS that leads you to believe someone may have used your Social Security Number fraudulently, you should notify the IRS immediately. Indicators can be found in notices from the IRS that state:

1. More than one tax return for you was filed, or

2. IRS records indicate you received wages from an employer unknown to you.

Don’t hesitate or be nervous about contacting the IRS. The agency knows this is a growing problem and not an “opportunity” to pound on taxpayers.

Richard A. Chapo is with http://www.businesstaxrecovery.com - recovery of business taxes through tax help and tax relief. Visit http://www.businesstaxrecovery.com/articles to read more business tax articles.

Protecting yourself from Identity Theft (ID Theft) is an important matter. ID Theft is defined by the Federal Trade Commission (FTC) as, “when someone uses your name, address, Social Security number, bank or credit card account number, or other identifying information without your knowledge to commit fraud or other crimes.”

In a summary report dated September of 2003, the FTC reported that “almost 10 million Americans have discovered that they were the victim of some form of ID Theft within the last year.” Further, the FTC estimates that the “total cost of this crime approaches $50 billion per year.” (The report can be viewed and printed at http://www.ftc.gov/os/2003/09/synovatereport.pdf.)

Though preventing ID Theft is ideal, also important is your ability to quickly determine when your identity is being used without your knowledge. Early detection is essential in preventing undue loss, as well as protecting your credit from long-term damage. One means of finding out if you have been a victim of ID Theft is through the use of a credit report.

A credit report is a list of all credit cards, debts, accounts, and other information associated with your social security number. That is, by going to the website of one of the three main credit reporting agencies and running a credit report, you will be able to see all the financial information linked to your social security number. Most importantly, you may be able to identify an error or fraudulent activity.

When viewing your credit report online, information will be given in seven sections: personal information, account information, inquiries, collections, public records, consumer statement, and dispute file information. One of your main objectives should be to verify all accounts and information as being valid. Carefully read the entire credit report looking for errors or anything unfamiliar. If you should see something out of the ordinary or wrong, contact the credit reporting agency immediately- you may be a victim of ID Theft.

Equifax, one of the three major credit reporting agencies, says you should, “Check your credit report regularly. Checking your credit report can help you catch mistakes and fraud before they wreak havoc on your personal finances. Make sure your report is accurate and includes only those activities you’ve authorized. It’s also a good idea to review your credit report from each of the three major credit reporting agencies every year — it’s possible that information is reported to one but not the others.”

To that end, Equifax has developed a great tool for running your credit report. It is called the “3-in-1 Credit Report”. You can sign-up with Equifax and view your information with all three major credit reporting agencies at one time (this can also be done through the other two credit reporting agencies- TransUnion and Expirion). Currently, this detailed report costs around $30 on the Equifax website (www.equifax.com) and is well worth it. Running your credit report is an important first step in prevention and early detection of ID Theft.

For tips on how to further protect yourself from ID Theft, or if you believe your identity has been stolen, please visit the FTC website (http://www.consumer.gov/idtheft/).

About The Author: Jonathan Citrin provides financial goal planning services. Go to http://articles.citringroup.com for hundreds of educational articles about personal finance, retirement planning, investment planning, and college savings.