A Complete Guide to Reporting IRS Tax Identity Theft and Recovering Your Refund

Tax identity theft is one of the fastest-growing refund problems in the United States. It happens when someone uses your Social Security Number to file a fraudulent tax return before you do—claiming your refund, your dependents, or your credits. For victims, the first sign is usually a rejected e-file or a sudden IRS notice stating that “a return has already been filed.”

If this happens, you must act immediately. The IRS has a very specific process for identity theft cases, and the sooner you submit Form 14039 (Identity Theft Affidavit), the faster the IRS can freeze the fraudulent return and begin the recovery process.

This guide walks you through every step, explains what happens after you file Form 14039, and outlines the real timeline for getting your refund back.

Step 1: Confirm That You Are a Victim of Tax Identity Theft

Common signs include:

• Your e-file is rejected with Code IND-181 or IND-183
• You receive a notice that “multiple returns” were filed under your SSN
• You see a suspicious return on your IRS Online Account
• Your transcript shows a TC 150 or TC 976 return that you did not file
• Refund holds and fraud alerts appear out of nowhere

If any of these occur, assume identity theft and move to the next step.

Step 2: File Form 14039 (Identity Theft Affidavit)

The IRS requires victims to file Form 14039 to start the identity theft investigation.

You can submit Form 14039 by:

1. Uploading it in your IRS Online Account

This is the fastest option.

2. Mailing or faxing it to the IRS

Fax is generally faster than mail.

3. Including it with a paper-filed return

Only if your electronic return was rejected due to duplicate filing.

The form asks for:

• Your personal information
• Explanation of the fraud
• Whether you previously experienced identity theft
• Documentation proving your identity (driver’s license, passport, etc.)

Once submitted, the IRS places a fraud freeze on your account to stop further damage.

Step 3: File Your Real Tax Return (If It Was Rejected)

If a fraudulent return was filed first, e-file will reject yours.

You must:

• Print your original tax return
• Attach Form 14039
• Mail the entire packet to the IRS

The IRS cannot process your legitimate return until the identity theft unit completes its review.

Step 4: Wait for IRS Processing (This Is the Longest Stage)

After receiving Form 14039, the IRS moves your case into the Identity Theft Victim Assistance (IDTVA) pipeline. This is one of the slowest processing departments at the IRS.

Typical timeline:

• 120–180 days: Standard identity theft cases
• 6–9 months: Cases involving duplicate dependents or income
• 9–12 months: Complex multi-year identity theft cases

During this time, your transcript may show:

• TC 971 – Identity theft indicator
• TC 810 – Refund Freeze
• TC 570 – Additional Review Hold
• TC 290 or 291 – Adjustments after the fraudulent return is removed
• TC 846 – Refund Issued

This is a long process, even when everything is done correctly.

Step 5: Respond to Any IRS Identity Verification Letters

The IRS may require you to verify your identity again through:

• Letter 5071C
• Letter 5747C (in-person verification)
• Letter CP01A (IP PIN assignment notice)

If requested, verify your identity immediately, or the review will not move forward.

Step 6: Monitor Your Transcript for Updates

Throughout the recovery process, your IRS transcript is the best tool for tracking progress.

Key signs your case is advancing:

• The fraudulent return is reversed
• TC 810 is removed
• A new TC 150 appears for your real return
• TC 571 or 572 (Hold Released) posts
• TC 846 (Refund Issued) is added

If your transcript is not moving after 120 days, you may need to escalate.

Step 7: Contact the Taxpayer Advocate Service (If Delays Exceed 120–180 Days)

The Taxpayer Advocate Service (TAS) helps when:

• Your refund is frozen for months
• You cannot get answers from the IRS
• You are experiencing financial hardship
• The IRS has not worked your identity theft claim

TAS cannot speed up mandatory fraud reviews, but they can ensure your case is not sitting untouched in a backlog.

Step 8: Once Resolved, Protect Your Identity with an IRS IP PIN

After an identity theft case is closed, the IRS usually issues a 6-digit Identity Protection PIN (IP PIN).

This prevents anyone from filing a return with your SSN next year.

You can get an IP PIN through:

• IRS Online Account
• CP01A letter
• IRS IP PIN tool
• In-person verification

This is the most effective long-term protection for your refund.

How Long Does It Take to Recover a Stolen Refund?

The IRS states 120 days, but in reality:

• Most cases take 4–6 months
• Identity verification problems take 6–9 months
• Severe identity theft cases can take up to a year

Refunds are only issued after:

1. The fraudulent return is removed
2. Your real return is accepted
3. All identity steps are completed
4. Review holds and fraud freezes are lifted

Only then will you see TC 846 (Refund Issued).

Tax identity theft is stressful, but the recovery process is clear:

1. File Form 14039
2. Submit your real tax return
3. Verify your identity
4. Wait for the fraud investigation to complete
5. Monitor your transcript for updates
6. Protect your account with an IP PIN

The sooner you act, the faster you stop the damage and get your refund moving again.

Identity theft cases take time, but they do get resolved—and your refund can be recovered once the IRS clears your account.