The Internal Revenue Service (IRS) and its partners in the Security Summit coalition have issued a stark warning regarding an increasing threat of identity theft that targets both businesses and individual taxpayers. This advisory comes as part of the annual National Tax Security Awareness Week, emphasizing the need for heightened vigilance against an array of sophisticated scams. These scams often take the form of communications that purport to be from legitimate sources such as the IRS, banks, or well-known tax professionals, but are actually designed to deceive individuals into revealing sensitive personal information.
IRS Commissioner Danny Werfel noted that identity thieves are continually adapting and refining their tactics to exploit vulnerabilities. “With the IRS and the Security Summit partners working together to increase our defenses against fraud, it means identity thieves increasingly look to steal valuable information from businesses large or small, individual taxpayers, as well as tax professionals,” he said. The message from Werfel underscores the importance of individuals and businesses regularly reviewing and strengthening their security measures, especially during peak times for fraud, such as the holiday shopping season and the lead-up to tax filings.
The Security Summit, a collaborative initiative that includes the IRS, state tax agencies, and tax professionals from across the nation, has been actively working since its inception in 2015 to combat tax-related identity theft. This year marks the ninth annual celebration of National Tax Security Awareness Week, a time when the summit aims to raise public awareness about the increasing prevalence of scams and the common tactics employed by fraudsters. The IRS has indicated that the coordinated effort has successfully helped protect millions of taxpayers and has prevented significant amounts of money from falling into the hands of criminals.
Recent scams have become more elaborate and insidious, utilizing platforms like social media to distribute misleading information about tax credits and refunds. Taxpayers have been lured into sharing personal information by scammers mimicking trusted entities, including charitable organizations. The IRS has emphasized that real communications regarding tax issues will not come in the form of unsolicited emails or text messages; official correspondence will always be communicated through formal mail bearing the IRS seal.
To bolster defenses against such scams, experts recommend that businesses and taxpayers alike adopt a range of security practices. Maintaining updated security software, backing up important financial documents, implementing strong passwords in conjunction with multi-factor authentication, and encrypting devices can significantly mitigate risk. Additionally, individuals and organizations are encouraged to verify any solicitations they receive before acting, avoiding links or attachments without independent confirmation of the source’s legitimacy.
As the deadline for tax returns approaches, the risk of identity theft tends to increase. Scammers may attempt to file false tax returns using stolen personal or business information, exploiting the backlog of submissions during peak filing seasons. In response to these threats, the FTC’s Bureau of Consumer Protection has emphasized the importance of education in cybersecurity for small businesses. Samuel Levine, the bureau’s director, stated, “During National Tax Security Awareness Week, the FTC commends IRS efforts to educate businesses on how to enhance their cybersecurity while recognizing and avoiding common scams.”
Taxpayers need to act proactively to safeguard against identity theft. They should ensure their Employee Identification Numbers (EIN) remain current and accurate, reporting any changes within the required timeframe using IRS Form 8822-B. In the event of a potential identity theft situation, there are procedures set forth by the IRS that guide victims on how to report the incident effectively. For example, if a business receives a notice about a tax return they didn’t file or encounters a balance due that is not owed, it should utilize the Business Identity Theft Affidavit (Form 14039-B) to report the issue proactively.
Moreover, should businesses suspect that a data breach has occurred, they are advised to visit the IRS’s Identity Theft Central, which provides detailed guidance on how to handle such situations. The proactive reporting of IRS-related scams can also make a difference; reports can be directed to [email protected] to help protect others from similar predatory actions.
As scammers continue to evolve their tactics, it is crucial for both businesses and individual taxpayers to remain alert and informed. By taking simple, but effective steps to protect sensitive information, it is possible to mitigate risks associated with identity theft. The IRS and its partners will continue to work collaboratively to enhance defenses against these threats, but the responsibility also lies with taxpayers to be proactive in protecting their financial data.
This ongoing dialogue about security reinforces the broader need for awareness in a rapidly changing financial landscape. As the IRS and Security Summit partners continue their work to fortify resistance against fraud, individuals and businesses must remain engaged in these discussions and take actionable steps to protect themselves and others from potential harm. Visit CashNews.co for further insights and continuous updates on financial security and issues affecting taxpayers today.