Security Summit: IRS Prepares for 2018 Filing Season

Security Summit: IRS Prepares for 2018 Filing Season
On October 17, 2017, the IRS joined with representatives of the software industry, tax preparation firms, payroll and tax financial product processors and state tax administrators to combat identity theft refund fraud. At the Security Summit press briefing, Commissioner Koskinen discussed progress to ensure safeguards to protect taxpayer data. Please read his full statement here: Commissioner Koskinen stated that the number of identity theft-related tax returns has fallen by about two-thirds since 2015.

The Security Summit partners and process started in 2015 with the initial hope to stop the growth in identity theft that has been threatening our tax system. Since 2015, the IRS has put multiple safeguards into place as the federal, state, and private sectors work together to implement stronger password protocols for tax professional software, share information and work with financial institutions to help identify suspect refunds. The number of confirmed identity theft returns has declined by 37 percent since 2015, as reported in the calendar year 2016. This trend has continued into the 2017 calendar year.

There will be new safeguards for business returns when it comes time to file. The IRS will be asking tax professionals to gather more information on their business clients who file forms 1120 and 1041 tax returns. Some new questions the IRS will ask to provide will include:

• Name and Social Security number of the individual authorized to sign the business return;
• Payment history and questions regarding whether estimates were made;
• Parent company information;
• Additional information based on deductions claimed;
• Filing history or other business tax related forms such as a 940 or 941.

The IRS also warns all tax and payroll professionals to vigilant of cybercriminals and imposters acting as clients over the phone. The IRS and the Summit partners will be doing their annual campaign to alert the public about steps they can take to protect their financial data while online.