Tax fraud, identity theft, and the like have become such big
problems in recent years that state tax administrators, tax companies, and the
IRS have all collaborated to come up with what they hope will be a strategy to
prevent or at least reduce tax fraud. These three bodies have agreed to share
information with one another whenever suspicious returns are noticed and to use
stronger authentication methods when it comes to verifying taxpayers’
identities.
These changes are expected to take place in time for next
year’s filing season, but don’t expect to notice them. Many of the changes,
such as the new authentication processes, will take place in a way that isn’t
easily observable to taxpayers. In fact, most taxpayers are unlikely to notice
any differences when they file.
So, what exactly will be different? Well, to begin with, the
makers of the tax filing software are going to be sharing information with the
IRS and the state revenue department that will allow these organizations to
determine if the return was filed from a “safe” computer, how long it took for
the return to be completed, and other information that could indicate fraud.
Many people are incredibly happy about these new changes and
think they really will be the first step in ending fraud. The CEO of H&R
Block has praised the IRS for its new plans and has agreed to undertake
stronger authentication methods for his own company’s dealings.
Many other companies are falling in line. Tax preparers and
software makers have readily agreed to share data with the IRS and to alert the
organization to any computer system attacks or attempted attacks, as well as to
suspicious filing patterns, returns, or behaviors.
These measures couldn’t have come at a better time. Identity
theft and tax refund fraud have risen steadily over the last few years. Even
better , the IRS has reported that they are working on more, similar measures
to roll out in the near future. These latest developments are the results of
only three months of work by the combined organizations after they noticed an
increase in over-the-phone tax scams and fraudulent returns.
The future, in other words, is looking safer for taxpayers,
and that’s a wonderful thing! #UseTaxpreparers #PreventTaxFraud