Tax related identity theft is an issue that began several years ago and has been steadily increasing as each year passes. We see this most often when electronically filed tax returns are rejected by the IRS with the most common reason for the rejections being due to previously filed fraudulent returns. Fraudsters can file tax returns using a taxpayer’s (or dependent’s) social security number in order to generate fraudulent refunds without the taxpayer’s knowledge.
How can I proactively prevent this?
The IRS is currently offering a voluntary program in which taxpayers can opt-in to receive an Identity Protection PIN (IP PIN). The IP PIN is a 6-digit number assigned to an individual taxpayer which will allow the IRS to verify your identity, and will prevent someone else from filing a tax return (electronically or by paper) using your social security number.
How do I obtain an IP PIN?
Taxpayers who are confirmed victims of identity theft will receive an IP PIN from the IRS via postal mail once their case has been resolved. Individuals who would like to opt in to the IP PIN program as a proactive measure to prevent tax-related identity theft will need to complete an identity authentication process and create an IRS account at IRS Accounts. You will need to provide a valid email address, your social security number or individual tax identification number, tax filing status, mailing address, your mobile telephone number, and one financial account number linked to your name (i.e., credit card, student loan account, mortgage/home equity account, auto loan account, etc.)
Taxpayers with annual incomes of $72,000 or less who are unable to register for an IP PIN using the IRS on-line application feature, can apply for one by mail by completing and submitting IRS Form 15277. Individuals who are unable to complete the identity authentication process on-line or by mail can schedule an in-person appointment at a Taxpayer Assistance Center via this link: In-person Appointment
Are there other things I should know?
IP PINs are valid for one calendar year. A new IP PIN will be generated each year prior to filing your tax returns.
Married couples and dependents will need to separately apply, with each individual obtaining their own unique IP PIN. When completing the return, an IP PIN needs to be entered for each individual who is included in the return (as filer or dependent) who has one.
Your IP PIN should not be shared with anyone except for your tax practitioner. If you use the services of a CPA or accountant to prepare and file your tax returns, the preparer will need to enter your IP PIN into their software in order to include it on your return.
Where can I get more information?
Please feel free to contact a Prager Metis team member if you have any IP PIN or other tax-related questions. Detailed information can also be found on the IRS website at Get an IP PIN