Preparers need to be aware of the following regarding tax identity theft:
This page is designed to give you information to help make you aware of the security measures preparers should be taking to secure their computer systems and client personal information. Also to let you know the latest ways identity thieves are attempting to obtain personal information from individuals and tax preparers and steps that IRS, States and the tax industry are taking to help protect taxpayers from becoming a victim of identity theft.
The following are covered:
Security and Tax Preparers
What IRS States are doing to Combat Tax Identity Theft
Security Summit – Collaborative Effort by IRS, States and Tax Industry Partners to Fight Tax Identity Theft
Links for More Information on Tax Identity Theft
Security and Tax Preparers
This past filing season the number of phishing email schemes that were targeted at tax preparers increased over prior years. Due to this trend of tax preparers becoming increasingly the targets of cybercriminals they must do more to protect themselves.
The goal of these criminals is to gain access to a preparer’s client tax data and to their tax software in order to file fraudulent returns. In short they want to take over their computer system.
Access to a preparer’s client tax data not only allows the identity thieves to obtain each client’s personal information, it also makes it possible for the identity thief to create fraudulent returns that contain similar information for each individual in order to not be caught by the IRS and State identity theft filters.
Access to a preparer’s tax software program allows the identity thief the opportunity to modify existing returns that have not been completed or transmitted and file additional fraudulent returns using the software.
Because of this increased interest by identity thieves, tax preparers need to take steps to protect their computer systems as well as protecting their client’s personal and tax information. Tax preparers need to increase their security protections by taking the following steps:
For more information on what tax preparers can do to protect themselves see the following on the IRS website:
Phishing schemes that preparers need to be aware of:
Steps IRS and States are taking to Prevent Tax Identity Theft
Since the Security Summit was formed in 2015 the IRS, States and the tax industry have implemented steps to help fight tax identity theft. Here are some examples of what the IRS and States have done:
Since March 2015, IRS officials, State tax administrators, Tax Software industry, Financial institutions, and tax preparer groups have been working together to identify the steps that need to be taken to combat tax-related identity theft.
The Security Summit has also been focusing on making tax preparers aware that they are vulnerable to phishing email schemes that target them with the intent of taking over a preparer’s computer system to gain access to their client information and their tax program.
Over the past two filing seasons the Security Summit has implemented the following to help protect taxpayers:
For more information on the Security Summit see the following IRS webpages:
2018 Changes to Form 8867 (Preparer Due Diligence Checklist)
November 9, 2018
2018 Depreciation Changes
October 18, 2018
2018 Tax Law Changes that are Directly Reported on Form 1040
October 3, 2018
IRS Tax Transcripts Changes
September 27, 2018
Revised 2018 Schedule A due to Tax Cuts and Jobs Act Changes to Itemized Deductions
August 29, 2018
2018 Expansion of Preparer Due Diligence Requirements
August 8, 2018