Security Summit Says IP PINs Can Protect Taxpayer Information

by | Dec 3, 2020 | Tax Tips and News

Taxpayers who want to make it harder for identity thieves to successfully file a fraudulent tax return using their information will soon be able to sign up for an IP PIN. Starting in January 2021, the Internal Revenue Service says it will allow any taxpayer to sign up for the Identity Protection PIN Opt-In Program—provided they can “properly verify their identities.”  

This announcement comes on the third day of National Tax Security Awareness Week, an educational outreach event designed to help taxpayers and tax professionals protect their private data from criminals. Previously, the only way to get an IP PIN was to participate in the pilot version of the Identity Protection PIN Opt-In Program or for the IRS to confirm you had been the victim of identity theft.

What is an IP PIN?

According to the IRS, an IP PIN “is a six-digit number assigned to eligible taxpayers to help prevent the misuse of their Social Security number on fraudulent federal income tax returns.” Once you register for an IP PIN, the IRS will only accept your tax return if it lists this new identification number—making it much harder for identity thieves commit identity theft tax refund fraud using your information.

How do I register for the Identity Protection PIN Opt-In Program?

To sign up for an IP PIN, use the Get An IP PIN tool located on IRS.gov. While this separate identification number can help taxpayers protect their identities, the IRS notes that applicants who use the online tool “must pass a rigorous authentication process … that uses Secure Access authentication.” (Learn more about Secure Access at IRS.gov/SecureAccess.)

The IRS says that taxpayers should review the following information before submitting an IP PIN application:

• The Get an IP PIN tool will be available in mid-January. This is the preferred method of obtaining an IP PIN and the only one that immediately reveals the PIN to the taxpayer.
• Taxpayers who want to voluntarily opt into the IP PIN program do not need to file a Form 14039, Identity Theft Affidavit.
• The IP PIN is valid for one year. Each January, the taxpayer must obtain a newly generated IP PIN.
• The IP PIN must be properly entered on electronic and paper tax returns to avoid rejections and delays.
• Taxpayers with either a Social Security number or Individual Tax Identification Number who can verify their identities are eligible for the opt-in program.
• Any primary taxpayer (listed first on the return), secondary taxpayer (listed second on the return) or dependent may obtain an IP PIN if they can pass the identity proofing requirements.
• The IRS plans to offer an opt out feature to the IP PIN program in 2022 if taxpayers find it is not right for them.

Luckily, there are options for IP PIN applicants who can’t complete the online identity verification process.

“Taxpayers with incomes of $72,000 or less and with access to a telephone should complete Form 15227 and mail or fax it to the IRS,” the IRS explains. “An IRS assistor will call the taxpayer to verify their identity with a series of questions. For additional security reasons, taxpayers who pass authentication will receive an IP PIN the following tax year.”

Note: While the program is being expanded to include voluntary IP PIN requests, confirmed victims of identity theft are still eligible to receive an IP PIN at no charge after filing Form 14039.

Source: IR-2020-267

– Story provided by TaxingSubjects.com

Multi-factor Authentication Spotlighted for National Tax Security Awareness Week

by | Dec 2, 2020 | Tax Tips and News

Day two of National Tax Security Awareness Week is all about multi-factor authentication. Following opening day warnings about the increased number of phishing scams that taxpayers will face over the holidays, during tax season, and throughout 2021, it makes sense that the second day emphasizes a security measure that the Internal Revenue Service says “will be available on all 2021 online tax preparation products.”

“The agreement to add the multi-factor authentication feature is just one publicly visible example of the ongoing collaboration by the IRS, state tax agencies, and the tax industry, which work together as the Security Summit,” the IRS says. “2020 marks the fifth year of the Security Summit and of National Tax Security Awareness Week.”

How does multi-factor authentication protect improve account security?

Multi-factor authentication is a term used for accounts that require more than one piece of user-provided information to access. While this process can take many forms, the IRS says that users may be required to enter a code that is texted to their phone or sent to an authentication app to log in. (Those who have enabled multi-factor authentication on a web-based email account like Gmail or Yahoo! Mail are already familiar with the process.)

But why does multi-factor authentication work?

“Thieves use a variety of scams—but most commonly by a phishing email—to download malicious software, such as keystroke software … to steal all passwords from a tax pro,” the IRS explains. “However, with multi-factor authentication, it’s unlikely the thief will have stolen the practitioner’s cell phone—blocking the ability to receive the necessary security code to access the account.”

Multi-factor authentication is an optional feature—and you should use it!

The IRS rightly points out that “no product is fool-proof,” but that doesn’t mean individual security features aren’t effective. When it comes to multi-factor authentication, the IRS flat-out states that the feature “does dramatically reduce the likelihood that taxpayers or tax practitioners will become [identity theft] victims.” But you can’t be protected by something you don’t use.

To read more about day one of National Tax Security Awareness Week, check out our blog, “National Tax Security Awareness Week Opens with a Warning.”

Source: IR-2020-266

– Story provided by TaxingSubjects.com