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September 13, 2007
FREEZING YOUR CREDIT
Lately, I’ve been giving a lot of thought about my credit and what to do about my personal information that has been stolen. Last week I received a letter form the Connecticut Department of Revenue saying that a laptop computer had been stolen that contained my name and social security number.
You may be wondering, what was my name and social security number doing with the Connecticut Department of Revenue? The answer is that I prepared a tax return for a client who had gone to one of the Connecticut casinos, and won some money. What many people do not realize is, that if you win at one of these casinos, you need to file a Connecticut income tax return. If you end up paying tax in Connecticut on your gambling winnings, Massachusetts will allow you to take a credit on your Massachusetts income tax return, giving you credit for the taxes that you paid to Connecticut.
Once someone has your name and social security number, bad things can happen, such as applying for credit cards in your name, or identity theft. Here are some tips to outsmart the thieves:
PROTECT YOUR MAIL – Shred sensitive information such as charge receipts, bank statements, expired credit cards and all of those pre-approved credit offers that you receive in the mail. Promptly remove mail from your mailbox and have the post office put your mail on hold when away on vacation.
GUARD YOUR CREDIT CARDS – Just because you have 6 different credit cards, it doesn’t mean that you need to carry all of them around with you. Minimize the number of credit cards you carry and do not keep your PIN with your credit card. Be aware the billing cycle of your credit cards. If you don’t receive a bill, it could be a sign that someone has intercepted your mail and tampered with your credit card account.
FRAUD ALERT – The three credit reporting companies are Equifax, Experian, and TransUnion. If you feel that your personal information has been stolen, place a fraud alert on your credit care account(I chose this option). The fraud alert will alert credit companies that you have been a victim of fraud and will make it much harder for anyone to open a new credit account in your name.
FREEZING YOUR ACCOUNT – Freezing your account means that you have contacted one of the three credit reporting companies and told them not to issue any information to anyone. This eliminates the ability to open any new credit accounts. About 33 states allow the option of freezing your account, Massachusetts is not one of them.
I recommend that everyone do two very simple things. First, you should make a record of all of your credit cards, and the telephone number to call if one of them gets lost. The second thing is to get a copy of your credit report for free, once every year. In order to get your free credit report, you should call 1-877-322-8228 or visit www.AnnualCreditReport.com.
This article gives general information and not specific advice on individual matters. Persons wanting individualized advice on matters discussed should contact an advisor experienced in those matters. To the extent this article provides information on legal matters, it is based on law in effect in Massachusetts on the date of posting (laws in effect in other states are often quite different).
Ronald H. Surabian is a CPA and attorney who works at the Elder Law Center in Saugus, Massachusetts. He also holds Masters in accounting and a Masters in tax law. He currently serves on the board of directors of the Massachusetts Chapter of the National Academy of Elder Law Attorneys. If you have any questions please call me at the Elder Law Center, One Essex Street, Saugus, MA 01906 (781)233-4444. To view this or any prior article, please visit our web site at www.elderlawcenter.org