June 07, 2013

As the IRS and press focus on the recent identity theft epidemic, a large segment of our population is often overlooked: our kids.

Protecting Your Kids from Identity Theft

The new risk

Many school forms now require personal information and often the information that is collected is not stored with the same discipline that a bank or the IRS might store the information. In addition, child activities and service providers, like doctors, are asking for and storing your child's sensitive information. Is this a problem?

The warning signs

According to the Federal Trade Commission, there are a number of warning signs that your child's identity is being misused.

  • You are turned down for benefits. This is often due to someone else using your child's social security number for similar benefits.
  • The IRS sends you a notice. A notice from the IRS often means someone else has filed a tax return using your child's information.
  • Your e-filed tax return is rejected. An automatic rejection can occur when someone else is using your child's information to claim them as a deduction.
  • You start receiving mail and bills in your child's name. These vendors received this information from someone. Best case? There is an information leak. Worst case? Someone is purchasing things using your child's identity.
  • You receive collection calls. In this case the damage has been done and you will need to assess the scope and breadth of the problem.

What you can do

  • A safe location. Place all your child's sensitive information in a safe location. If it is stored digitally, make the file a password protected file and a file that is not easy to find.
  • Be careful what you share. Do not use your child's social security number in any application that is not absolutely necessary. If you do, make sure you trust the other party and understand how they are protecting the information.
  • Create an identifier. Instead of using your child's social security number, create another identifier that can be used and given to outside vendors.
  • Shred. Shred all documents that show personal information prior to throwing it out.
  • Pay attention. Read all the forms and notices sent home from school. If personal information is included, ask why and how it is being protected.
  • Know your privacy rights. The Federal Family Educational Rights and Privacy Act (FERPA) protects the privacy of student records. Schools should have a student directory information policy and a policy on school surveys. Know your rights before filing out the forms.

When your child reaches the age of 16, check their credit reports with the major credit reporting companies. Hopefully, there is not one. But if there is, you should have ample time to review the reports and correct errors prior to your child needing a clean record for employment, school, or other credit needs. The three companies are:

  • Equifax: 1.800.525.6285 or www.equifax.com
  • Experian: 1.888.397.3742 or www.experian.com
  • TransUnion: 1.800.680.7289 or This email address is being protected from spambots. You need JavaScript enabled to view it or www.transunion.com

Copper Canyon Tax and Accounting Services is a full service provider of business accounting,
business income tax, personal income tax, and payroll in Tucson, Arizona.
Topic: Advice