Maryland Tax Identity Theft Risk Grows for 2026 Filers

Maryland tax officials are warning residents about heightened risks of tax-related identity theft and refund fraud as the 2026 filing season gets underway. State and federal agencies say criminals often act early, filing fraudulent returns before legitimate taxpayers file theirs. Officials are urging Maryland residents to take preventive steps now to protect their personal information and tax refunds.

Maryland Officials Warn of Increased Tax Fraud Activity

The Maryland Comptroller’s Office says tax-related identity theft remains a serious concern at the start of filing season. The crime typically involves criminals using stolen personal information, most often Social Security numbers, to submit false income tax returns and claim refunds.

State officials say fraud attempts often increase in January and February, when many taxpayers are still gathering documents. During this period, scammers rely on speed, hoping to file fraudulent returns before legitimate ones are processed.

The Comptroller’s Office says Maryland continues to invest in fraud detection systems and coordination with federal partners. Even so, officials stress that taxpayer awareness plays a critical role in stopping fraud before it causes long delays.

How Tax Refund Fraud Typically Happens

Tax refund fraud usually begins long before filing season opens. Criminals obtain personal data through phishing scams, data breaches, or impersonation schemes, then test that information once tax systems start accepting returns.

Stolen Identities Used to File False Returns

Using stolen Social Security numbers, criminals file tax returns that appear legitimate on the surface. These returns often result in refunds being issued quickly, sometimes to direct deposit accounts controlled by fraud rings.

Automated screening systems at the state and federal levels flag many suspicious returns. However, some fraudulent filings are only discovered after a legitimate taxpayer attempts to file and encounters problems.

Victims Often Learn About Fraud After Delays

Many taxpayers first discover identity theft when an electronically filed return is rejected because a return has already been submitted under their Social Security number. Others may notice issues when an expected refund does not arrive.

Resolving these cases can take months and often requires identity verification and additional documentation.

Maryland Data Show Scale of Fraud Attempts

The Maryland Comptroller’s Office says recent enforcement efforts demonstrate both the scope of attempted fraud and the effectiveness of detection systems.

In calendar year 2023, the state identified and blocked more than 17,000 fraudulent tax returns. Those actions prevented over $76 million in fraudulent refunds from being issued.

Officials say indicators of identity theft are placed on affected taxpayer accounts to help prevent repeat misuse. These safeguards remain in place for future filing seasons.

Steps Officials Recommend to Reduce Risk

Maryland officials and the IRS emphasize prevention as the most effective defense against tax identity theft. Once fraud occurs, resolving it can be time-consuming, even when taxpayers act promptly.

Identity Protection PIN Offers Added Security

The IRS encourages taxpayers to enroll in the Identity Protection PIN program. An IP PIN is a six-digit number that must be included on a tax return for it to be accepted.

The program is now available to all taxpayers who can verify their identity online. The PIN changes annually and does not affect refund amounts or filing status.

Filing Early Limits Exposure

Filing a legitimate tax return as soon as all documents are available reduces the opportunity for criminals to file first. The IRS began accepting 2025 tax returns on January 26, 2026.

Officials say early filing remains one of the simplest ways to reduce fraud risk, particularly for taxpayers who receive refunds.

Concerns About Tax Preparer Fraud

Maryland and federal agencies also warn that not all fraud involves stolen identities alone. Some cases involve dishonest tax preparers who misuse client information or submit false returns.

Warning Signs Taxpayers Should Know

Red flags include preparers who refuse to sign returns, do not provide a Preparer Tax Identification Number, or base fees on a percentage of the refund. Taxpayers are encouraged to verify credentials through the IRS directory of federal tax return preparers.

Officials advise reviewing completed returns carefully and keeping copies of all tax records.

Federal and State Coordination on Enforcement

Tax identity theft prevention relies on cooperation among states, the IRS, and the tax industry. These efforts are coordinated through the Security Summit partnership, launched in 2015.

Ongoing Focus on Fraud Detection

The partnership focuses on data sharing, improved authentication, and public education. Maryland participates by aligning its fraud filters with federal standards and sharing information with other states.

Officials acknowledge that criminals continue to adapt, requiring constant updates to detection systems.

What to Do If You Are a Victim of Tax Identity Theft

Taxpayers who suspect identity theft are urged to act quickly. Prompt action can limit delays and reduce the risk of additional misuse.

IRS Verification and Paper Filing May Be Required

If a taxpayer cannot file electronically because a fraudulent return was already submitted, the IRS advises filing a paper return and following its identity theft assistance process. Some taxpayers may receive IRS letters requesting identity verification before returns can be processed.

The IRS advises following the instructions carefully and avoiding duplicate submissions unless directed to do so.

What Maryland Taxpayers Should Do Now

As filing season continues, officials say vigilance remains essential. Taxpayers are encouraged to secure online accounts, safeguard tax documents, and stay cautious of unsolicited communications.

Officials Emphasize Awareness Throughout Filing Season

The IRS and the Maryland Comptroller do not initiate contact by email, text message, or social media to request personal information. Messages demanding immediate payment or action are common indicators of fraud.

By filing early, using identity protection tools, and relying on official guidance, Maryland taxpayers can reduce the risk of identity theft and avoid disruptions during the 2026 tax season.

Source Links

• Internal Revenue Service, “Get an Identity Protection PIN”
• Internal Revenue Service, “How IRS Identity Theft Victim Assistance Works”
• Internal Revenue Service, “Security Summit”

‍By William Mc Lee, Editor-in-Chief & Tax Expert—Get Tax Relief Now