Because
of improved protections in recent years, the Internal Revenue Service stops the
vast majority of fraudulent tax returns using stolen identities. But identity
thieves and criminal syndicates continue to persist and evolve.
As
the threat has changed, so has the IRS. In a new era of cooperation, the IRS,
the states and the entire tax industry came together to identify what
additional steps could be taken to better fight identity theft and better
protect the taxpayers.
Starting
in January 2016, this renewed effort will make for a safer, more secure filing
season for taxpayers.
Many
changes will be invisible, but they are critical to making sure the IRS can
verify the taxpayer and the legitimacy of the tax return before it ever enters
into the tax processing system. More than 20 shared data elements will help the
software industry and the IRS stop fraudulent returns at the door.
For
example, the IRS will receive information from software providers about the
duration of time it took to create the return. This will help identify the
computer-generated tax returns that are fraudulent and filed in bulk.
The
IRS, states and tax industry will share details of any fraudulent schemes they
see on a frequent basis so everyone will have the same information and adjust
accordingly to provide increased protection to taxpayers.
The
most publicly visible aspect of these partnership efforts will be for those
taxpayers who prepare their own tax returns using tax software or online
products. There will be new procedures that will help prevent fraudsters from
taking over the accounts of taxpayers. These include:
- New password standards to access tax software will require a minimum of 8 characters with upper case, lower case, alpha, numerical and special characters.
- A new timed lockout feature and limited unsuccessful log-in attempts.
- The addition of three security questions.
Out-of-band verification for email addresses, which is sending an
email or text to the customer with a PIN – a common practice used throughout
the financial sector.
The IRS also has teamed up with state revenue departments and the
tax industry to make sure you understand the dangers to your personal and
financial data. Taxes. Security. Together. Working in partnership with you, we
can make a difference.
It’s important that everyone take steps to protect their personal
and financial data online and at home. Computer users should always use
security software that includes firewall and anti-virus protections. Sensitive
information such as tax records should be encrypted if stored on your computer
or secured by lock and key if on paper.
To learn additional steps you can take to protect your personal
and financial data, visit Taxes.
Security. Together. You also can read Publication
4524, Security Awareness for Taxpayers.
Each and every taxpayer has a set of fundamental rights they
should be aware of when dealing with the IRS. These are your Taxpayer
Bill of Rights. Explore your rights and our obligations to protect them on
IRS.gov.
Additional IRS Resources:
www.irs.gov/identitytheft – Identity Protection: Prevention, Detection and
Victim Assistance
IR-2015-129,
IRS, States and Tax Industry Announce New Steps to Help Public to Protect
Personal Tax Data
Fact
Sheet 2015-23, IRS, States and Industry Partners Provide Update on
Collaborative Fight Against Tax-Related Identity Theft
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