Published June 29, 2015

Recent IRS Data Theft – What You Need to Know and What You Need to Do

The Basics

In May 2015, hackers accessed the Internal Revenue Service’s (IRS) “Get Transcript” program after collecting personal taxpayer information from various non-IRS sources, including social media sites. Stolen information included social security numbers, dates of birth, street addresses, and tax filing status, which allowed the hackers to file fake tax returns. The responsible parties attempted to steal records from 200,000 individuals and were successful in approximately 104,000 of these cases. The hacking resulted in the submission of 36,500 fake returns to the IRS. The IRS fraud protection system failed to stop 13,000 of these fraudulent returns, which resulted in $39 million erroneously issued refunds.

What the Government Is Doing

The “Get Transcript” application on the IRS website has been temporarily shut down. The IRS notes that this issue does not involve its main computer system, which handles tax filing submission. This is secure. They are sending notices to the 200,000 taxpayers whose accounts were affected, alerting them to the breach and providing details as to which information was accessed. The 104,000 taxpayers whose accounts were compromised will receive free credit monitoring to ensure that any retrieved information is not being used illegally in other areas. To prevent hacking in the future, the IRS is partnering with tax software firms, payroll companies, and staff agencies to help combat identity theft.

What You Should Do

If you have been contacted by the IRS by mail (please note that the IRS does NOT use email), immediately contact your PYA representative. Do not assume that the notice is spam or a hoax. Once PYA reviews the notice, we will instruct you to contact the IRS or will obtain Power of Attorney to do so on your behalf. The IRS then will provide the necessary steps to file your tax return and prevent future occurrences. The IRS is aggressively working to ensure the security of taxpayers’ information. In addition, they are asking taxpayers to be mindful of sharing their personal information. Strive for discretion as to what you post on social media sites. In addition to obtaining your full name, date of birth, and street address, hackers are able to easily retrieve passwords and answers to security questions just from visiting your Facebook page. Since it is impossible to be constantly vigilant about what you share, it is especially important to take security questions seriously. Choose the harder questions. Be specific in your answers. Some sites even offer the opportunity to create your own questions. The more obscure your questions and answers, the better. Staying knowledgeable is an imperative part of your financial safety, in this instance and all others.

PYA is here to support and protect your personal information. Be assured that we utilize the highest security measures to safeguard your financial and personal information through our tax software platform, email system, and our secure client portal available on our website.

If you would like more information about our tax services, contact the experts listed below at PYA, (888) 420-9876.

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