I have often read that one of the ways to prevent identity theft is to never share one’s Social Security Number (SSN), unless it is absolutely essential. Of course anybody with a reasonable amount of common sense will never do so, but I cannot help but wonder – how do we determine when it is necessary?
My husband and I have just invested in a piece of land, and are currently in the process of building our home on it. The land is owner-financed, and the sellers are a charming retired couple who live next door. We have known them for over two years now and share a great rapport. The other day they said that their new CPA has asked for our SSNs. Now I have very high regard for this couple and will trust them with all I own, but sharing our SSNs did sound off the warning bells in my head. Since their previous CPA did not need these details, why does the new CPA need them and how will I know that this kind of sensitive information is safe with her? All these thoughts made me do some digging up on matters relating to sharing SSN details. I wanted to make sure whether I was under any obligation to furnish this information since it has been requested, or whether it is optional.
Why Must You Be Very Careful With Your Social Security Number?
For starters, the 2010 Identity Fraud Survey Report states that identity fraud claimed over 11 million U.S residents last year, resulting in a total cost of $54 billion. When in the wrong hands, your SSN can leave you in a mammoth financial mess. The good news is that most of those victims did not lose more than an average of $373, though it took each victim 21 hours to get things sorted out.
How Can You Safeguard Your SSN?
It is quite simple really, if you just take a few precautions:
•Always keep your Social Security card in a safe place, and no, your wallet does not count.
•Your SSN is confidential, period. Never jot it down behind checks, even if asked to do so. If anyone uses your SSN as your account number, get it changed immediately.
•Always ignore phone calls or email requests for your SSN, even if you are familiar with the organization.
•Sometimes you cannot avoid sharing your SSN, like when you have requested for an online insurance quote. In such cases, always ensure that the company you are dealing with is trustworthy, and the server that is carrying the information is a secure one.
•Make sure you receive your free credit reports every year and look out for any unusual credit lines.
When Is Sharing Your SSN Necessary?
There are some instances when you must provide your SSN, like the following:
•When you take up a new job, you have to give your SSN to your employer, for payroll purposes. Your employer’s payroll records and W-2 must show your accurate name and number, as Social Security has to credit your earnings.
•Financial institutions you deal with must have your SSN for purposes of tax reporting.
•Government agencies like motor vehicle departments will ask for your SSN. However, you must know that all government agencies, be it local or federal, are obligated to inform you whether your SSN is necessary or optional, how they intend to use it, and the authority under which it is being asked for.
When Your SSN Is Requested, But Not Required
Most businesses will ask for your SSN, and unfortunately, there aren’t any stringent restrictions on how they can use it. Businesses like health care organizations, consumer reporting agencies and information resellers can use your SSN in a number of ways. The law gives you the right to refuse sharing your SSN details, but then the business may refuse to provide you their services. When faced with such a dilemma, make sure you ask the following questions:
•Why do you need my SSN?
•How do you intend to use this information?
•Is it mandatory by law and if yes, which one?
•What security measures does your company take to safeguard customer SSNs?
•If I refuse to provide it, how will it impact our association?
Clearly express your concerns about identity theft with a manager or supervisor of the company and find out if they are willing to accept an alternative identifier instead of your SSN. If they do not and you are not comfortable, find someone else to business with.
Coming back to our story, eventually we did not have to share our SSNs as the sellers did not need them any more. It seems they had asked for our numbers as it was required for filing taxes online, which they opted out of. Of course I had not suspected any kind of fraudulent activity here, but prevention is always better that cure, right? Remember, keeping your SSN confidential is vital, and a request for it is not always a necessity.
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