Identity theft affects millions of Americans every year. The damage — fraudulent accounts, drained bank accounts, IRS refund theft, employment fraud — can take months or years to fully resolve. But the severity of that damage depends enormously on how quickly and systematically you respond.
This is the complete action plan, organized in order of priority.
Step 1: Freeze Your Credit at All Three Bureaus (Do This First)
A credit freeze — also called a security freeze — prevents new credit from being opened in your name. It's free, permanent until you lift it, and the single most effective thing you can do to stop an identity thief from opening new accounts.
You must freeze at all three major bureaus separately:
- Equifax: equifax.com/personal/credit-report-services or 1-800-685-1111
- Experian: experian.com/freeze/center or 1-888-397-3742
- TransUnion: transunion.com/credit-freeze or 1-888-909-8872
When you freeze, you'll receive a PIN or password for each bureau — save these. You'll need them to temporarily lift (thaw) the freeze when you want to apply for credit legitimately.
Also consider freezing at secondary bureaus:
- ChexSystems (used by banks for checking account applications): chexsystems.com
- NCTUE (used by utility companies): equifax.com/personal/credit-report-services
- LexisNexis (used for background checks): consumer.risk.lexisnexis.com
Timeline: Credit freezes at the three major bureaus must be activated within one business day of your request online/by phone.
Step 2: Place a Fraud Alert
A fraud alert is different from a freeze. It doesn't block new credit, but it requires lenders to take extra steps to verify your identity before extending credit. Initial fraud alerts last one year; extended fraud alerts last seven years.
You only need to place a fraud alert at one bureau — they're required to notify the other two.
Extended fraud alert (7 years): Available to identity theft victims who have filed a report with the FTC or law enforcement. Requires submitting an identity theft report. Provides the most protection — lenders must contact you directly before extending credit.
You can have both a freeze and a fraud alert simultaneously. They provide different protections and complement each other.
Step 3: File a Report at IdentityTheft.gov
Go to identitytheft.gov (run by the FTC) and report the theft. This creates:
- Your official FTC Identity Theft Report: This is a legal document — it triggers rights under the Fair Credit Reporting Act and serves as your formal notification that you're a victim
- A personalized recovery plan: The site guides you through exactly what to do based on the specific type of identity theft you've experienced
- Pre-filled letters: Letters you can send to creditors and credit bureaus, customized for your situation
Print and save your FTC Identity Theft Report. You'll need it for every subsequent step — filing police reports, disputing fraudulent accounts, and applying for an IRS Identity Protection PIN.
Step 4: File a Local Police Report
Go to your local police department with:
- Your FTC Identity Theft Report
- A government-issued photo ID
- Proof of your address
- Any documentation you have of the theft (fraudulent bills, collection notices, credit report printouts showing fraudulent accounts)
Get a copy of the police report or the report number. Some creditors and bureaus require a police report (in addition to the FTC report) before they'll take action.
Step 5: File for an IRS Identity Protection PIN (IP PIN)
Tax identity theft — someone filing a fraudulent tax return in your name to claim your refund — is one of the most damaging and hardest to resolve forms of identity theft.
IRS Identity Protection PIN (IP PIN): A six-digit number that must be included on your tax return to verify it's actually filed by you. Once you have an IP PIN:
- The IRS will reject any return filed without it
- It completely prevents tax return identity theft for future years
How to get one:
- Go to irs.gov and use the "Get an IP PIN" tool (requires identity verification)
- Identity theft victims can request one; as of 2021, any taxpayer can opt in voluntarily — you don't have to be a victim
If a fraudulent return has already been filed: File Form 14039 (IRS Identity Theft Affidavit) by paper to the IRS, along with a copy of your FTC report. Expect the resolution process to take 6–18 months — the IRS will eventually process your correct return and issue any legitimate refund.
Step 6: Contact Each Affected Creditor
For every fraudulent account opened in your name, contact the creditor's fraud department (not customer service — specifically the fraud team):
- Inform them you're an identity theft victim
- Provide your FTC Identity Theft Report and police report
- Request that the account be closed and all charges be waived
- Request written confirmation that the account is closed and the fraudulent charges removed
Under the Fair Credit Reporting Act, you have the right to ask creditors to block fraudulent information from being reported to credit bureaus. Send your request in writing.
Step 7: Dispute Fraudulent Accounts with Credit Bureaus
Pull your credit reports (free at annualcreditreport.com) and review them carefully for accounts you didn't open, inquiries you didn't authorize, and addresses you never lived at.
For each fraudulent item, send a dispute letter to each bureau reporting it. Include:
- Your FTC Identity Theft Report
- A police report (if available)
- A copy of your credit report with the fraudulent items marked
- Your identification (name, address, SSN, date of birth)
Credit bureaus must:
- Investigate within 30 days (or 45 days if you send additional information)
- Remove confirmed fraudulent information
- Block (not just delete) information you've identified as resulting from identity theft when you provide an identity theft report
Send everything by certified mail with return receipt. Keep every piece of correspondence.
Step 8: If Your Social Security Number Was Used for Employment
Employment fraud — someone using your SSN to get a job — causes a specific problem: their employer reports wages under your SSN to the IRS, which then has income records that don't match your return.
If this happens:
- Get an SSA Earnings Statement from ssa.gov to see what wages are reported under your SSN
- File Form 14039 with the IRS noting employment fraud
- Contact the Social Security Administration to correct your earnings record
- Consider requesting a new SSN from the SSA — this is a last resort as it causes its own complications, but SSA does issue new numbers in severe cases
Ongoing Steps: Monitoring and Follow-Up
Identity theft recovery isn't a single event — it requires ongoing attention:
- Monitor your credit reports monthly: Use free tools (Credit Karma, your bank's credit monitoring, or annualcreditreport.com) to catch new fraudulent activity quickly
- Check your credit card and bank statements weekly: Fraudulent small charges are often test transactions before a larger hit
- Watch for mail you didn't expect: Bills, collection notices, or credit offers for accounts you didn't open
- Check your Social Security earnings record annually: Verify no unauthorized employment appears on your SSA statement
- Renew your IP PIN annually: The IRS issues a new IP PIN each year — you must retrieve it online each January before filing your return
A Note on Identity Theft Protection Services
Services like LifeLock, Experian IdentityWorks, and others monitor for signs of identity theft and can help with recovery. They provide some value — particularly the monitoring alerts and dedicated recovery assistance — but they cannot prevent identity theft. A credit freeze is still the most effective preventive measure and it's free.
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