Identity theft – Increased Security in the 2016 Tax Season

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Identity theft is one of the fastest growing crimes in America that intensifies during tax season. It is a major issue not only for private and government institutions, but also for everyday Americans. This year the IRS is taking a proactive stance to lower the number of fraudulent tax returns filed by joining forces with private industry and state tax administrators.

2016 tax season will be marked by increased security and greater number of validation procedures to complete returns. Although many are still in testing stage, there will be roughly 20 new data elements that are expected to uncover fraudulent tax returns. New security measures are expected to prevent fraudulent tax returns filed electronically and on paper.

Some of the areas of increased security will include:

  • identity proofing to protect taxpayer accounts – in-person and technology-enabled proofing.
  • device recognition at the time of log-on – out-of-wallet questions, auto-email generation for confirmation of any changes to the account.
  • education of taxpayers to adopt best practices in protecting own identity via personal information, tax records, and electronic devices.

The growing concern over identity theft culminated this year with the provisions taken at the Security Summit. These provisions will encompass areas of authentication, information sharing, and strategic threat assessment and response (STAR). The STAR group is responsible for proactive approach to securing online identity rather than responding to issues at hand. STAR team will take a look at the entire tax system to identify its weaknesses and develop strategies to detect and prevent misappropriation of personal information.

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