Tuesday, November 17, 2015

IRS Promises More Identity Theft Protections in 2016 Filing Season

After acknowledging earlier this year that hackers breached one of its popular online apps, the IRS has promised more identity theft protections in the 2016 filing season. The IRS, along with partners in the tax preparation community, has identified and tested more than 20 new data elements on returns to help detect and prevent identity-theft related filings. The agency is also working to prevent criminals from accessing tax-time financial products.

Identity Theft

Combating identity theft is on ongoing process as criminals continue to create new ways of stealing personal information and using it for their gain. Tax-related identity theft typically peaks early in the filing season. Criminals file bogus returns early so taxpayers remain unaware you have been victimized until they try to file a return and learn one already has been filed. Between 2011 and 2015, the IRS identified 19 million suspicious returns and prevented the issuance of some $60 billion in fraudulent refunds. During the 2015 filing season, the IRS detected and stopped more than 3.8 million suspicious returns.

However, criminals continue to probe for weaknesses. In May, the IRS discovered that criminals had breached its Get Transcript app. Return information of as many as 300,000 taxpayers may have been compromised, the IRS reported.

New Protections

In March, the IRS began working with the return preparation community and the tax software
industry to develop a coordinated response to tax-related identity theft. The stakeholders, the IRS reported, have focused on a number of areas including improved validation of the authenticity of taxpayers and information on returns, increased information sharing to improve refund fraud detection and expand prevention, as well as more sophisticated threat assessment and strategy development to prevent risks and threats.

One outgrowth of the process is the creation of new data elements that can be shared at the time of filing with the IRS to help authenticate a taxpayer's identity. The IRS explained that there are more than 20 new data components. They will be submitted with electronic return transmissions during the 2016 filing season. Some of the data elements are

  • Reviewing the transmission of the tax return, including the improper and/or repetitive use of internet addresses from which the return is originating;
  • Reviewing the time it takes to complete a tax return, so computer mechanized fraud can be detected.
  • Capturing metadata in the computer transaction that will allow review for identity theft related fraud.

"We are taking new steps upfront to protect taxpayers at the time they file and beyond," IRS Commissioner John Koskinen said at a news conference in Washington, D.C. "Thanks to the cooperative efforts taking place between the industry, the states and the IRS, we will have new tools in place this January to protect taxpayers during the 2016 filing season."

Financial Products

Previously, the IRS announced that it would limit the number of direct deposit refunds to a single financial account or pre-paid debit card to three. Fourth and subsequent valid refunds will convert to paper checks and be mailed to the taxpayer. The IRS emphasized that it will continue to bolster its efforts to curb tax-time financial product fraud.

If you have any questions about tax-related identity theft, or you would like a copy of our FREE GUIDE titled "Taking Charge - What To Do If Your Identity is Stolen", please contact our office.


Contact Our Office Today For a FREE Copy

Wrentham, Norfolk, Plainville, Franklin, Walpole, income tax, tax calculator, hr, irs forms, Jackson Hewitt, tax, tax act, tax return, tax brackets, income tax return, tax refund, taxes, accountant, h&r, tax return calculator, tax forms, free tax filing, federal income tax, federal tax forms, federal tax return, tax online, tax returns, online tax return, irs e file, tax return status, file taxes online, tax preparation, income tax return online, instant tax services, accountants, income tax filing, income tax forms, federal tax, estimate tax return, taxes online, online tax filing, tax services, federal taxes, what is income tax, tax filing, tax questions, online tax, e filing income tax, irs free file, free tax preparation, filing taxes, file taxes, state taxes, tax accountant, h and r, tax planning, free tax return, free federal tax filing, online taxes, free state tax filing, free online tax filing, federal income tax forms, tax help, free tax, how to file taxes, tax preparer, tax consultant, free taxes, income tax returns, complete tax, federal tax forms, free taxes online, income taxes, income tax return efiling, free efile, h&r, tax advisor, tax advice, best place to do taxes in wrentham, wrentham tax, wrentham tax planner, wrentham tax prep, wrentham income, wrentham income tax, wrentham accountant, wrentham accounting

No comments: