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Published byMuriel Dulcie Hodge Modified over 9 years ago
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Preventing and Detecting Identity Theft: Partnering with the IRS to Meet the Challenge
Anita Douglas Senior Stakeholder Liaison November 13, 2015
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IRS Strategic Approach
Prevention Detection Victim assistance Enforcement
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IRS Strategic Approach: Prevention and Detection
All returns pass through hundreds of filters Accelerated return matching information Imposed limits on number of direct deposit refunds issued to a single financial account Locked deceased taxpayer accounts
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Taxpayer Protection Program
Letter 4883C: taxpayer must call TPP toll-free number to verify identity Letter 5071C: taxpayer should use idverify.irs.gov to verify identity Letter 5447C: taxpayer may either call international TPP line or mail verification
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Steps for IDT Victims For tax-related victims, IRS requires:
Complete IRS Form 14039, Identity Theft Affidavit Respond immediately to any IRS letters or notices Continue to file and pay taxes, even if by paper Preparers need power of attorney (Form 2848) and CAF number to complete the form on client’s behalf
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Completing a Form 14039 Submit only for taxpayers who have suffered a loss of personally identifiable information, such as an SSN Check the appropriate box, i.e. Box 1 if the loss of PII is affecting tax administration Identity verification required Follow submission instructions
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IRS Strategic Approach: Prevention and Detection
Approved use of information received from local police Improved protection for SSN Improved procedures to stop prisoner refund fraud Partnered with financial institutions and debit card industry
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IRS Strategic Approach: Prevention and Detection
To prevent IDT from reoccurring, we Place indicators on taxpayers’ accounts Issue Identity Protection PINs Continue testing IP PIN program in Florida, Georgia and District of Columbia
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IRS Strategic Approach: Prevention and Detection
Aggressive efforts yielding results 2.27 million confirmed IDT returns stopped $15.8 billion protected plus $545.6 million refunds returned through partnership with financial institutions 1,063 new criminal investigations; 748 sentenced Data is calendar year 2014
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IRS Summit on IDT Recognition that IDT is always evolving
Pledge to fight a common enemy Three working groups looking at: Additional steps – especially on technology front Short and long-term actions
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IDT: New for 2016 Improved filters and modeling
New rules for ITIN users Direct deposit limits remain in place Mandatory device ID sharing
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Identity Protection PIN
New number issued before each filing season via CP01A notice Currently, no opt-out provision Lost IP PINs may be retrieved online Replacement IP PINs may be obtained from IDTVA, but subject return to scrutiny
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Future of Victim Assistance
Methods of protecting taxpayer accounts under on-going review and evaluation Movement toward online products, such as an online Form or Get an IP PIN Results of location-specific pilot program being assessed Centralization of inventory work underway
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IDT: New for 2016 Centralization of IDT victim assistance work within Accounts Management Reviewing next steps for Identity Protection PINs Comprehensive review of EFIN process to help you protect your number
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Partnering with the IRS
Know your clients; verify their identities Don’t use your EFIN to file other preparers’ returns Check EFIN numbers weekly Notify the IRS if EFIN numbers are too high
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Protecting Taxpayers and Your Business
Protect taxpayer data and your business from becoming data breach victims Review your security arrangements Review Publication 4557, Safeguarding Taxpayer Data
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Protecting Taxpayers and Your Business
Securing taxpayer data is the law Make a security plan using best practices Data breach? Have a plan Contact local IRS stakeholder liaison to notify IRS of data breach
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Protecting Taxpayers and Your Business
Partner with IRS to share the warnings Avoid /phone scams aimed at you or taxpayers Recognize an “account takeover’ attempt Urge clients to protect IP PINs, e-File PINs
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Additional Information on IDT
Pub 4557, Safeguarding Taxpayer Data Pub 5027, Identity Theft Information for Taxpayers Pub 5199, Tax Preparer Guide to Identity Theft
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W-2 Verification Code Pilot for 2016 Filing Season
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W-2 Verification Code Pilot
One in a series of steps to combat ID theft and tax fraud Pilot will test capability to verify authenticity of W-2 data filed with federal tax returns in 2016 IRS will soon name Payroll Service Providers PSPs will reach out to some clients Algorithm generates alphanumeric codes from selected data fields of the W-2 Verification codes appear on employees’ W-2s
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W-2 Verification Code Pilot
Taxpayers enter verification codes on their e-filed federal tax returns When processing returns, IRS recalculates codes Matching codes = genuine W-2s Verification codes not included in W-2 data submitted to SSA, states or local departments of revenue Won’t affect state or local tax returns
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W-2 Verification Code Pilot
We stress: Omitting or using incorrect W-2 verification codes will not delay the processing of taxpayers federal tax returns “test-and-learn” review after pilot If integrity of W-2 information submitted by taxpayers increases, verification codes will remain an element of W-2s in the future
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THANK YOU!!! Anita Douglas
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