Unearned payments reported via IRS Form 1099

The FBI Internet Crime Complaint Center (IC3) reports an increase in complaints from individuals receiving Internal Revenue Service (IRS) 1099 Forms. The IRS 1099 Form is a collection of tax forms documenting different types of payments made by an individual or a business which usually is not the person’s employer.

The IC3 is receiving complaints reporting fraudulent Form 1099-K, Payment Card and Third Party Transactions and 1099-MISC, Miscellaneous Income. These forms report taxable income from third party eCommerce companies for which the complainants state they did not earn.

It is likely the complainant’s Personal Identifiable Information (PII) was used to fraudulently open accounts with eCommerce (electronic commerce) companies as third party sellers. Some IC3 complainants report receiving unknown returned packages related to sales with the eCommerce businesses to their addresses prior to receiving the Forms.

If you received a Form 1099 due to fraudulent circumstances:

Follow the IRS procedures for reporting a fraudulent return, documented here: www.irs.gov/uac/Taxpayer-Guide-to-Identity-Theft. In addition, visit the IRS Identity Theft Central website for more information, www.irs.gov/identity-theft-central.

Monitor your credit reports through the major credit bureaus for any suspicious activity.

File a police report with your local law enforcement agency.

File a complaint with the IC3, www.ic3.gov

It is also suggested to contact the eCommerce business who issued the payments to ensure the fraudulent sales account is closed or suspended.