A tax ID or EIN is unique to every organization. It is much like a Social Security Number for an individual. This EIN is required to open and transact on bank accounts for the organization, hire employees, apply for licenses etc. Even for a non-profit organization, having an EIN is mandatory. It is the first step to procure a tax-exempt status. A non-profit organization should know when to apply for a non profit tax id, which is, at the earliest possible.
Just as obtaining a tax ID is necessary for an organization, it is also important to protect it from theft.
How do tax ID thieves attempt to fraud you?
Identity thieves are the most active at the time of filing tax return. They can scam you into answering fraud phone calls and emails by posing as IRS agents, or even obtain your personal information from financial documents. It is thus important to protect your tax ID from such thieves.
How to protect from tax ID theft?
- Keep your tax ID private
Avoid sharing your tax ID unless absolutely necessary and only with authorized finance personnel. Never share it over unidentified mail or phone call.
- Don’t fall for scam
Don’t just believe anyone posing as IRS agent and asking for your tax ID or any financial information. Avoid answering to fraudulent IRS emails/phone calls. Remember the IRS will never try to reach you by email, text or social media.
- Stay safe from phishing
If at all you receive an email asking to share your financial info or tax ID, forward it to firstname.lastname@example.org and delete it. Don’t open any attachments with that mail or reply to it.
- Protect your computer
Make sure you have updated your antivirus, anti-spyware and firewalls on your computer. Use a data-wipe program before you decide to recycle or sell it off.