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Security Summit warns tax pros of new signs of ID theft

Written on Aug 23, 2021

The IRS, state tax agencies and the tax industry – working together as the Security Summit – are urging tax professionals to learn these signs of data theft so they can react quickly to protect clients:

  • Client e-filed returns rejected because client's Social Security number was already used on another return.
  • More e-file acknowledgements received than returns the tax pro filed.
  • Clients responded to emails the tax pro didn't send.
  • Slow or unexpected computer or network responsiveness such as:
    • Software or actions take longer to process than usual,
    • Computer cursor moves or changes numbers without touching the mouse or keyboard,
    • Unexpectedly locked out of a network or computer.
Tax pros should also watch for warning signs when clients report they've received:
  • IRS Authentication letters (5071C, 4883C, 5747C) even though they haven't filed a return.
  • A refund even though they haven't filed a return.
  • A tax transcript they didn't request.
  • Emails or calls from the tax pro that they didn't initiate.
  • A notice that someone created an IRS online account for the taxpayer without their consent.
  • A notice the taxpayer wasn't expecting that:
    • Someone accessed their IRS online account,
    • The IRS disabled their online account.

This is not a comprehensive list, the IRS warns: thieves are constantly adapting their tactics, so tax pros should stay on their toes. They should also ensure they have the highest security possible and contact these sources immediately if they sense or see something amiss:

Liaisons will notify IRS Criminal Investigation and others within the agency on the practitioner's behalf. Speed is critical. If reported quickly, the IRS can take steps to block fraudulent returns in the clients' names and will assist tax pros through the process.

Get information on how to report victim information to the states. Most states require that the state attorney general be notified of data breaches. This notification process may involve multiple offices.

Knowing the signs of identity theft is the final part of a five-part series sponsored by the Security Summit partners to highlight critical steps tax professionals can take to protect client data. This year's theme “ Boost Security Immunity: Fight Against Identity Theft,” focused on urging tax professionals to try harder to secure their systems and protect client data during this pandemic and its aftermath.

The series highlighted the protections offered by multi-factor authentication and key security steps, the use of the Identity Protection PIN for clients, scams to steal unemployment benefits and the dangers of phishing email/text scams.