Answer Man

Best things in life can be free — even from the IRS


Q. I have received a letter from the IRS informing me that someone had accessed my tax information. The letter also said the IRS is marking my account and that I should call and get an IRS pin number. I also can receive a free year of credit monitoring thru Equifax. Should I? Also, is Credit Karma a legitimate credit agency? If so, how can they give you credit scores for free? Could this whole thing be a scam or perhaps a ruse by Equifax?

— S.H., of Belleville

A. Oh, how jaded we’ve become. The IRS and a credit company want to shower you with riches, and you want to look gift horses in the mouth. Surely you don’t think some crook would dare use the IRS logo on a fake letterhead for nefarious purposes do you? Surely no Internet company would lure you in with a free offer only to sock it to you later. And, yes, surely I am being sarcastic.

Sadly, it is one of the realities of modern life that a high-tech marvel like the Internet can potentially be so misused that you often are unsure of what information to believe and what not to believe. However, in your case, I think I can assure you with relative certainty that this truly is an actual alert and legitimate offer of help from the IRS. And, from my research, you can take Credit Karma’s claim of offering free credit information at face value — although you’ll have to decide whether you’re willing to accept a few potential tradeoffs.

I offer this advice partly from personal experience. About four years ago, one of my credit card companies called one day to ask whether someone I knew was in Chicago with my credit card. For two or three days, someone had been making lots of purchases across the Windy City, racking up hundreds of dollars in expenses. I assured them I had not been north of Fairview Heights.

As it turned out, someone had hacked into an Internet company I had done business with and had stolen my credit information. All charges were erased from my bill, a new card was issued — and I, too, received a free credit monitoring offer from Equifax, which I immediately accepted. For the next year, I received monthly reports so I could ensure the fraud had stopped. There was no cost, and the service stopped immediately afterward.

It’s almost the exact same deal Target offered tens of thousands of its customers after its massive data breach last year — a year of monitoring from Experian worth $191. Now, the IRS finds itself in the same pickle. Earlier this year, the IRS announced that organized crime syndicates, perhaps from Russia, used personal data obtained elsewhere to access tax information on more than 100,000 U.S. taxpayers that the no-goodniks could use to file for fraudulent tax refunds. To help protect your credit, the IRS now suggests you call the toll-free Equifax number (which I checked to be legit) and give them your promotion code to receive your year of free monitoring.

How do I know the IRS letter is real? I can’t be 100 percent certain. When I talked to a couple of representatives, all they would confirm is that a letter similar to yours was sent to affected taxpayers. Obviously, they would not talk about your case specifically because I could have been a scammer posing as a reporter. As I said, it’s a complicated world. From all indications (the accurate Equifax number, etc.), it seems to be the real McCoy, and, personally, I’d definitely seek the monitoring and the PIN number to use on future tax returns. It can’t hurt, and it costs nothing. If you still have doubts, you can always call the number listed — or an IRS number found online or through directory assistance.

Credit Karma may be a slightly tougher call. Ever since its Website went live in February 2008, its business model has been to provide free credit scores and credit reports along with credit tools and information and financial recommendations based on each user’s credit profile. This year, the company began offering credit scores by Equifax as well as TransUnion, which made it the first reporting tool to offer weekly updated credit scores from two of the three major credit bureaus for free, according to Forbes.

I undersand that it sounds too good to be true because most other companies want a fee for the same information. Here’s the tradeoff: Like most other Internet companies, Credit Karma makes money through advertising so if you sign up you’ll likely receive numerous targeted advertisements for credit cards, mortgage refinancing, etc., depending on your credit particulars. However, you apparently can escape many of these offers by carefully reading through all terms on the sign-up page and checking the appropriate boxes.

Other than that, though, major economic experts seem to endorse it. Just last week, Kiplinger’s included it on its list of “awesome things you can get for free” and The Fiscal Times listed it as one of the country’s 15 most valuable startups.

Two final notes: While its own site apparently has never been hacked, the company was the subject of an Federal Trade Commission complaint in 2014 because its mobile app lacked adequate security. Also, I cannot personally vouch for the site because I find tracking my free credit reports periodically at sufficient for my needs.

Today’s trivia

What do many historians consider the oldest city park west of the Mississippi River?

Answer to Wednesday’s trivia: “Clabber” is a food made by letting unpasteurized milk turn sour, producing a yogurt-like substance that once was a popular breakfast food in the rural South. It also was used as a quick leavening agent for baking — which explains why in 1923 Hulman & Co., which owns the Indy 500 racetrack, changed the name of its baking products to Clabber Girl.

Send your questions to Roger Schlueter, Belleville News-Democrat, 120 S. Illinois St., P.O. Box 427, Belleville, IL 62222-0427, or call 618-239-2465.