The IRS has recently implemented a new system for identifying and verifying taxpayers’ identities. The system will require those wishing to access their online tax accounts or self-help tools to submit a selfie & a photo of their driver’s license.
These must be submitted through the vendor ID.Me which is serving as a third-party service provider to the IRS this year. The pairing is being seen as a safety measure to protect taxpayers and with the use of this third-party service. The IRS is surely increasing its cybersecurity standards in hopes of mitigating risk related to taxpayer information.
Fraud and Breaches in 2020
The IRS first started using this system in November of last year, following a series of high-profile data breaches in recent years past. This was seen notably in the summer of 2020 when the treasury stated that the department was the victim of a serious breach, leaving the IRS unsure of how the hackers got in, and what information they stole, leaving many seriously concerned without answers.
In the same year, an American was arrested for using information he received through data leaks, to file up to 12 million dollars in fraudulent tax returns. The IRS is rolling this authentication process out across their online apps and other programs as they wished to have it in place by the start of tax season, to further prevent any more data breaches.
Important Things to Know
A lot of misinformation is being spread around this identification process, such as that taxpayers will need to submit a selfie to file their return. This is not the case, a selfie will only be required for accessing online accounts and self-help tools.
IRS Bruce Friedland had this to say on the system, “The IRS emphasizes taxpayers can pay or file their taxes without submitting a selfie or other information to a third-party identity verification company. Tax payments can be made from a bank account, by credit card, or by other means without the use of facial recognition technology or registering for an account. To help protect the security of taxpayers, the IRS uses an identity verification process for accessing IRS’ self-help tools such as checking your account online and getting a transcript online.”
Other than checking your account and getting a transcript online, there are some other apps that will include this heightened authentication include; the Child Tax Credit Update Portal, Get an Identity Protection PIN (IP PIN), and Online Payment Agreement.
Wrap Up
The IRS seems very hopeful that the use of this system will protect taxpayers, but there are likely to be issues with the system. We will be keeping an eye on this to see how the process plays out this year.