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How to avoid scammers this tax season

Identity theft tops the list of problems reported to the Federal Trade Commission last year, with more than 250,000 complaints. Among identity theft issues is a growing scam that becomes more prevalent as tax day rolls around. According to the Internal Revenue Service (IRS), around 23,000 people have been flagged for tax-related identity theft in 2009.

How can you protect your identity this year - and your tax refund?

On "The Early Show" Monday, CBS News Business and Economics Correspondent Rebecca Jarvis discussed ways you can get scammed, how to protect yourself, and what to do if you fall victim to a scam.

How does it happen in the first place?

Jarvis explained someone can get your Social Security number and file a return on your behalf.

It might not be immediately obvious you've been scammed, Jarvis said. She said that's often the scariest part of this type of scam.

She explained, "The IRS isn't necessarily going to flag you if this happens. They may send you a letter that says, 'You made more than what you reported on your taxes.' That's one sign. Or when you go to e-file, when you file your tax return on the Internet, you may get rejected and you might get a message that says you've already filed - someone with that Social Security number has already filed."

So what should tax-payers be on the look-out for when they pay their taxes?

You'll never get an e-mail from the IRS, Jarvis said.

"That is a dead giveaway," she said.

But if you think you are a victim, you shouldn't rush to the IRS right away, because you might face a tax audit right off the bat.

"It's an arduous process to have to go through. What you can do is wait for that refund to come," Jarvis said. "It should take about six weeks, if you file by paper. Three weeks if you file electronically."

If you find out that that refund has already been cashed and you didn't receive it, Jarvis said that's a giveaway you are a victim.

She recommended contacting the IRS Identity Protection Specialized Unit to get an investigation started.

"This is a unit that's set up specifically to deal with this issue," she said. "... An investigation - if you're looking for the amount of time to wait - it can take up to six months before you get an answer on whether or not you've been a victim and what the IRS has to say."

Jarvis recommended these tips to fight tax-related identity theft:

1. Do not ever respond to an e-mail that looks like it came from the IRS.

2. Check a tax preparer's background. You want to know the background on that tax preparer before you hand over all that personal information. Vet them with friends, family, people who've used them in the past.

3. Keep those tax files secure. Have a safe internet connection. Hackers can actually hack in to your internet connection if you're not using a secure line.

4. Dispose of files carefully. Those old tax returns, if you are getting rid of anything, those W-2 forms, make sure that you shred them, also hold onto them for a handful of years because obviously the IRS can come back and ask for that information for up to three years.

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