Fraudsters exploit COVID-19 concerns

Written on Nov 30, 2020

Tax industry experts say there is a heightened need for security as fraudsters are using COVID-19 as an avenue to scam taxpayers and tax preparers. New protections being offered by Security Summit partners in January can help protect people against tax-related identity theft.

The IRS said taxpayers must remain vigilant because of the constantly evolving threats and scams. There are thousands of variations of COVID-related scams, including many related to the economic stimulus payment by the IRS.

The IRS and Security Summit partners are sharing YouTube videos on security steps for taxpayers. The videos can be viewed or downloaded at Easy Steps to Protect Your Computer and Phone and Avoid Phishing Emails.

Employers also can share Publication 4524, Security Awareness for Taxpayers, with their employees and customers while tax professionals can share with clients.

The National Tax Security Awareness Week features basic security guidance for those most at-risk: individual taxpayers, business taxpayers and tax professionals. Highlights include:

Protect personal and financial information online

  • Use security software for computers and mobile phones – and keep it updated.
  • Avoid phishing scams, especially related to COVID-19 or Economic Impact Payments.
  • Use strong and unique passwords for all accounts.
  • Use multi-factor authentication whenever possible.
  • Shop only secure websites; Look for the "https" in web addresses and the padlock icon; avoid shopping on unsecured and public Wi-Fi in places like shopping malls.

Use multi-factor authentication

  • All tax software providers are offering multi-factor authentication options on products for both taxpayers and tax professionals.
  • Multi-factor authentication protects online accounts by requiring a second verification code in addition to your credentials (username and password). This second feature may be a code sent to your mobile phone, for example.
  • Multi-factor authentication provides a critical layer of protection for your online accounts.

Get an Identity Protection PIN

  • Starting in January, taxpayers who can verify their identities may now opt into the IRS IP PIN program. Here's what you need to know:
  • The Identity Protection PIN or IP PIN is a six-digit code known only to you and the IRS. It provides another layer of protection for taxpayers' Social Security numbers on tax returns.
  • Use the Get An Identity Protection PIN (IP PIN) tool at IRS.gov/ippin to see if the IP PIN is right for you and to immediately get an IP PIN.
  • Never share your IP PIN with anyone but your trusted tax provider.

Businesses at risk for identity theft

Most cyberattacks are aimed at small businesses with fewer than 100 employees. Here are are some details:

  • Learn about best security practices for small businesses.
  • IRS protective masking of sensitive information on business transcripts starts December 13.
  • A Business Identity Theft Affidavit – Form 14039-B – is now available for all businesses to report theft to the IRS.
  • Beware of various scams, especially the W-2 scam that attempts to steal employee income information.
  • Check out the "Business" section on IRS' Identity Theft Central at IRS.gov/identifytheft.

Tax professionals should review their safeguards

  • Deploy basic security measures.
  • Use multi-factor authentication to protect tax software accounts.
  • Create a Virtual Private Network if working remotely.
  • Create a written data security plan as required by law.
  • Know about phishing and phone scams, especially related to fake clients, COVID-19 and the Economic Impact Payments.
  • Create data security and data theft recovery plans.

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