H2R CPA Blog

Preventing Identity Theft: Implementing a Credit Security Freeze and an Identity Protection PIN

by Phillip D. Zlokas, CPA

If you have been notified of a security breach where your information might have been compromised, you may wish to take preventative measures to protect your identity, such as adding a credit security freeze and creating an Identity Protection PIN.

Credit Security Freeze

To prevent new debt or credit cards from being opened in a person’s name without their consent, the primary protective step is to place a security freeze with each of the three nationwide credit bureaus: Equifax, Experian, and TransUnion. Each freeze must be established separately. A freeze is free, does not affect your credit score, and generally remains in place until you lift or remove it.

Best Practice: Keep all credit files frozen continuously and use a short, temporary lift only when you personally initiate a legitimate credit application.

A credit freeze is a strong preventive control, but it is not an absolute guarantee. It may not stop misuse of an existing account, identity theft involving taxes or employment, or an account opened by a provider that does not review the frozen report. Accordingly, the freeze should be combined with account alerts, periodic credit-report review, and secure management of your passwords and recovery credentials.

The Credit Freeze Process

  1. Information to Gather Before You Begin 
  • Your legal name, date of birth, Social Security number, current address, and prior addresses if requested.
  • A government-issued photo identification and a recent document showing your address, if identity verification requires uploads or mail.
  • Access to a secure email account and mobile telephone that only you control.
  • A password manager or other encrypted location for storing bureau usernames, passwords, PINs, recovery codes, and confirmation records.

Use the official websites listed below. Do not follow links in unexpected emails or text messages claiming to be from a credit bureau. Type the official address into your browser or use a saved bookmark.

  1. Freeze Each Nationwide Credit Report 

Complete all three freezes. Freezing only one or two reports leaves the remaining report available to a creditor that uses another bureau.

Equifax 

  • Online: Equifax security freeze    Telephone: 800-685-1111
  • Create or access your Equifax account, select the option to place a security freeze, complete identity verification, and save the confirmation. Before leaving the site, verify that the report shows a frozen status.

Experian 

  • Online: Experian security freeze    Telephone: 888-397-3742
  • Create or access your Experian account, select the option to place a security freeze, complete identity verification, and save the confirmation. Before leaving the site, verify that the report shows a frozen status.

TransUnion

  • Online: TransUnion security freeze    Telephone: 888-909-8872
  • Create or access your TransUnion account, select the option to place a security freeze, complete identity verification, and save the confirmation. Before leaving the site, verify that the report shows a frozen status.
  1. Document Completion of the Freezes 

Retain a simple record without storing your full Social Security number. A suggested log follows:

Bureau Date Frozen Confirmation Saved Credentials Stored Securely
Equifax Yes / No Yes / No
Experian Yes / No Yes / No
TransUnion Yes / No Yes / No

 

  1. Temporarily Lift a Freeze When You Apply for Credit 
  • Ask the bank, card issuer, or lender which bureau or bureaus it expects to check.
  • Log in directly to the applicable bureau account. Avoid permanently removing the freeze.
  • Select a temporary lift for the shortest practical period, such as the day of application or a brief application window.
  • Submit the application and retain the lender and application details.
  • After the period ends, confirm that the file again shows a frozen status. If the transaction ends early, restore the freeze immediately where the bureau permits.

If the lender cannot identify the bureau in advance, you may need to temporarily lift all three freezes. Keep the window limited and verify refreezing afterward.

  1. Add Monitoring and Account-Level Controls 
  • Enable real-time purchase, withdrawal, wire-transfer, password-change, and contact-information alerts on bank, brokerage, and credit-card accounts.
  • Review your reports through AnnualCreditReport.com. The federal identity-theft resource states that reports from Equifax, Experian, and TransUnion can be checked weekly for free.
  • Use unique passwords and multifactor authentication for your email, financial institutions, and bureau accounts.
  • Opt out of prescreened credit and insurance offers at OptOutPrescreen.com if desired.
  • If you suspect actual identity theft, visit IdentityTheft.gov for an FTC recovery plan and consider a fraud alert in addition to the freezes.
  1. Important Distinctions and Limitations

A security freeze restricts access to a consumer report for new-credit purposes. A fraud alert instead asks businesses to take additional steps to verify identity. A freeze is generally the stronger preventive measure for new credit, while a fraud alert may provide an additional layer when personal information has been compromised.

A freeze does not close existing accounts, prevent charges on an existing card, correct inaccurate credit-report information, or prevent every form of identity theft. Continue monitoring established accounts and promptly investigate unfamiliar inquiries, accounts, or transactions.

Credit Security Freeze Action Checklist

☐  Freeze Equifax

☐  Freeze Experian

☐  Freeze TransUnion

☐  Save confirmations and secure credentials

☐  Consider ChexSystems, Innovis, and NCTUE freezes

☐  Enable financial-account alerts

☐  Review credit reports

☐  Use temporary lifts only for applications you initiate

Identity Protection PIN

An Identity Protection PIN is a six-digit number issued by the Internal Revenue Service (IRS) to help protect taxpayers from tax-related identity theft. Once created, the PIN must be included when filing your federal tax return to verify your identity.

How to Create an Identity Protection PIN (IP PIN):

  1. Visit the IRS website at irs.gov and select “Get an IP PIN.”
  2. Sign in or create an account through the IRS identity verification system.
  3. Complete the identity verification process, which may require personal information, a valid government-issued ID, and financial account verification.
  4. Once verified, the IRS will issue a unique six-digit IP PIN that can be used when filing your federal tax return.
  5. A new IP PIN is generated annually and can be accessed through your IRS online account.

Using an IP PIN adds an extra layer of security and helps prevent unauthorized tax returns from being filed using your Social Security number.

Note: Professional Scope and Reliance 

This article is provided for general educational and administrative guidance and is not legal advice, credit-repair advice, or a guarantee that identity theft or unauthorized debt will not occur. Credit bureau procedures and website addresses can change. Confirm current requirements directly with the applicable bureau or reporting agency. If you discover unauthorized activity, contact the affected financial institution promptly and consult legal counsel or an identity-theft professional as appropriate.

Reach Out to Learn More

For assistance with implementing preventative measures to protect your identity, feel free to contact your H2R CPA liaison and they will be happy to assist you with any questions.

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