 International Deputy Secretary IRS Tax News IRS Security Summit renews warning for tax pros to guard against identity theft amid continued threats. The security summit, like the new Justice League, truth, justice, the American way tribes, come to save the world by providing a strong warning to be careful out there. Be careful out there. If there's bad guys, honestly this new Justice League doesn't make me feel quite as secure as the old one. This Justice League is gone. Is Superman on this new Justice League? No, his son runs it now, huh? That kid's won apple and fell way off the tree. And he's got a whole new approach, claims he doesn't even need his superpowers? Because the best approach is just to let the poor downtrodden criminals do whatever they want and focus their time and energy warning the non-criminals to be careful of the criminals. Andy thinks his dad's an idiot that ruined the world. You're an idiot. I'm an idiot. Well, that's great. We appreciate the warning. Anyways, IR2022-135 July 12, 2022 Washington as the battle continues against tax-related identity theft. The IRS state tax agencies and tax industry renewed their call, and they did so with like that fat signal at the middle of the night. But no one responded. So now they put it on their website and I'm reading it to you now. So this is their call. They renewed their call for tax professionals to be on guard against new and ongoing threats involving their systems and taxpayer data. So this effort begins next week with the Security Summit's annual summer campaign focused on tax professionals and taking fundamental steps to stop data theft from their offices. This is the seventh year that the Security Summit partners, the IRS, state tax agencies and the nation's tax community have worked to raise awareness about these issues through the quote, protect yourself, protect your clients, protect yourself, end quote campaign because the Justice League isn't going to do it for you anymore. So that's a relevant quote here. Protect your clients, protect yourself. The special five-part news release series will begin July 19th and run every Tuesday through August 16th, which coincides with the dates for this year's IRS nationwide tax forum. The forum will feature 32 webinars to help educate the tax professional community and several involve security-related features. This Thursday, July 14th is the last day for tax professionals to register to attend and have access to all 32 webinars. Holy moly, you better jump on that one right here right now. That's why we're bringing you this kind of news so you can act fast. For more information to register, you can visit IRS nationwide tax forum. There's a link to that here, quote, the IRS and the Security Summit partners continue to advance their shared efforts to protect their federal and state tax system from identity thieves end quote, said IRS Commissioner Chuck Reddick. So that's what they're doing here. They're giving us that firm warning to be careful because there's bad guys quote. As we've increased our defense cyber thieves increasingly turn tax professionals, especially smaller operations to look for secure security vulnerabilities. This is a critical link to protecting sensitive taxpayer information by taking some basic security step tax pros help protect against the relentless efforts of identity thieves end quote. So the same tax people always going over after the tax professional those thieves always going after the tax professionals who are of course the salt of the earth, you know, like they like making the world go round and these people targeting. It's just ridiculous. Any case, the summer's effort focuses on a reminder for tax pros to focus on fundamentals and watch out for emerging vulnerabilities being seen for those practitioners using cloud based services for their practice. So I would think this would typically be the case now, you know, if you have the tax software, some of the tax software you actually download on your computer and you still have to log in often time with with like online logins and so on. But other softwares these days are actually cloud based meaning you log on to the internet to log on to the software, which could be beneficial to some taxpayers, especially if you're in an office that's decentralized and different people possibly can access the cloud. But that clearly may then give access more easy access if you're not careful if you don't have the proper internal controls in place to have cyber criminals, you know, take log into those those accounts and actually file tax returns from the cloud, which you would think would be harder to do if the if the actual software was on a hard drive or on, you know, not on basically the cloud, although they could still do it, they could try to take advantage, they could try to take control of the computer, but you would, you would assume that that would be a harder thing to do. So in any case, identity thieves were especially active this past year as they continue to use pandemic nationwide teleworking practices in other events as predatory tactics for a variety of scams as ding predators tax professionals are prime targets for criminal syndicates that are both tech and tax savvy and well funded. These scammers either trick or hack their way into tax professionals computer systems to access client data. How dare they attacking tax people the salt of the earth for crying out loud someone. Where's the judge? Something needs to be done. Ah, anyway, even when tax pros think they have client data stored in a secure cloud lock lack of strong author authentication can make this information vulnerable. These can use stolen data to file fraudulent tax returns to make it more difficult for the IRS and the states to detect because the fraudulent returns use real financial information. So clearly this is becoming more and more relevant as basically we have more of these kind of refundable credits and we're using the tax code more as kind of a welfare program to some degree as opposed to a tax collection or simply or only kind of a tax collection type of thing. That means that the lower income tax returns the ones that were typically you would think be easier to file are becoming more and more valuable which actually sadly leads to targeting you would think of lower income individuals and tax professionals who are trying to do tax services for lower income individuals whose profit margins are probably quite lean in the first place and are probably trying to make money through bulk doing a lot of a lot of tax returns. So I would think that you know that's part of the issue of high the higher end tax professionals are probably making a good bigger profit margin possibly a larger firms and possibly then able to have the larger you know data protection hire someone to actually handle this stuff which is but in any case so other data thieves sell the basic tax preparer or taxpayer information on the web so other fraudsters can try filing fraudulent return so they could try to sell the information or file the return themselves in any case you know now the information's on the web and once all the social security numbers and all that stuff is out there which for many people it probably is given the fact that we've had the same social security numbers our whole lives and had to give them the every financial institution then you know it's more likely that this kind of fraud stuff can take place and someone filing a fraudulent tax return or unemployment compensation filing or some kind of crazy stuff so the security summit there's a link to that here formed in 2015 to join the fight against identity theft this the summit partners made great inroads against tax related identity theft dramatically reducing confirmed identity theft returns and saving billions in tax dollars during the next five weeks the security summit partners will highlight a series of simple actions that tax professionals can take to better protect their clients and themselves from sensitive data theft taking these steps now will help ensure that the progress in tax related identity theft that started in 2015 continues highlighted recommendations will be to sign up clients for identity protection pens now this is something like I said the social security numbers are something that's are kind of getting antiquated at this point and I'm not kind of I don't you know I don't know exactly what the fix is I don't think a chip in your forehead is a good idea or anything like that but but you would think if you have the same number your entire life and now we've got the internet you know when I was a kid we didn't have it would didn't seem like your social security number can go viral or something so and now obviously once it's out there it's going to be out there so you would think that if they rotate the security numbers the social security number in some way that would make something make it a little bit better in some cases although that would cause problems because now you got different numbers you got to deal with and so on but on the IRS side you might be able to use this pen thing which was used before when people law someone took their identity and filed a fraudulent return and then they gave them this pen which is basically like a second number like a social security number which they say they change yearly so now you can try to ask clients to do that up front to do that at the starting point so that so that they're protected and are less likely to have someone file a fraudulent return because if they do that it becomes a big hassle to deal with so you got you either deal with the pen which which might give you some security some insurance against that or you know if you get it if you get an actual identity theft thing then you got to deal with actually telling the IRS that wasn't actually me you sent the return to the wrong person and that kind of stuff so the IRS now offers IPP INS to all taxpayers who can verify their identities online on the phone with an IRS employee after filing a form 15 227 or in person the IPP INS is a six digit number that is known only to taxpayer and the IRS it helps prevent an identity thief from filing a fraudulent return in the taxpayers name tax professionals cannot obtain an IPP IN for their clients clients must verify their identities to the IRS so you can't like say taxpayers just give me go get me up get me one you know you got to set it up because it's kind of like the IRS is second social security number in essence for for you so the easiest way is at the get an IPP IN tool on IRS.gov there's a link to that here the IRS a lot electronic tax administration advisory committee there's a link to that here recently described the IPP INS quote the number one securities tool are currently available to taxpayers from the IRS this tool is the key to making it more difficult for criminals to file false tax returns and the name of taxpayers end quote so that doesn't mean they can't do other malicious stuff like file for unemployment or something like that if they steal your credentials and whatnot but at least you'll save yourself some time on the social on the on the IRS side of things and if you're a tax pro then you might want to advise clients of that because I could save times on both sides possibly so avoid spearfishing scams those day spearfishing people going around taking out tax professionals with spears what are they thinking so one of the most successful tactics tactics used by identity thieves against tax professionals is to spearfishing scam so these take time to craft professional emails to entice tax professionals to open a link embedded in the email or open an attachment so obviously as tax professionals were looking for new clients and whatnot so you would think most of these spearfishing scams are kind of like shotgun stuff where they send emails to everyone and they're clearly spam but if they target someone individually they can be much more sophisticated so it's not like these people are idiots when they're doing that when they're doing the shotgun approach they have a method that's why they're doing the shotgun approach that's why it looks corny and whatnot because they're probably have to you know they're doing lead generation basically so but if they're but you know if they're targeting a higher target one they can then they can try to impersonate a client and make it look a lot more legitimate and of course you might have multiple emails with them before they actually do the scamming thing to have you click on something that would download something so it's so it is what it is so tax pros have been especially vulnerable to spearfishing scams from these posing as potential clients these might carry on an email conversation with their target for several days before sending the email containing a link or attachment so the link or attachment may secretly download software into the tax pros computer that will give these remote access to the tax professional system so that's scary stuff it's like a ghost in your computer there's a ghost in my computer I wish it was a ghost no it's a dang spearfisher anyways know the tell sign the telltale signs of identity theft many tax professionals who report data theft to the IRS also say that they were unaware of the signs that a theft had occurred there are like if your mouse is moving around and like screens are popping that someone's site if you watch like a ghost sign into your tax software you know when you didn't touch the mouse that's a sign that's a sign be careful so there are many signs that tax pros should watch out for these include multiple clients suddenly receiving IRS letters requesting confirmations that they filed a tax return that deems suspicious so if you get letters from the client letters saying that something happened that you didn't do then someone else might be doing something funny so it might not just be the IRS just spit out a weird letter right so you want to look into it so tax professionals may see e-file acknowledgments for far more tax returns than they filed so if you're looking at acknowledgments you're saying I didn't file 500 tax returns this year I only did like 10 or something then you know it's a sign there's a sign there people computer cursors may move seemingly on their own again that last one kind of cracks me up that one yeah I had I had no idea that was this my software I thought there was a ghost doing my tax return work for me and just signed into my software anyways create a security plan not only is it a good practice the IRS also reminds tax professionals that federal law enforced by the federal tax trade commission requires paid tax return preparers to create and implement a data security plan an information security plan protects the business and client information will also providing a blueprint for action in the event of a security breach for many tax professionals knowing where to start when developing a written security plan presents challenges there are resources available to assist like the IRS publication 4557 safeguarding tax data there's a link to that here other resources to help tax pros will be highlighted in an upcoming news release so look forward to that we'll be here reading that news release like always it's gonna be great I can't wait my seat I'm on the edge of it my seats on the edge I'm not even using the backs the backstop because I'm on the I'm on the front edge of it of my seat help client protect themselves whether working from home or traveling with the continuation of work from home policies for many organizations taxpayers may find themselves conducting their affairs whether personal business or financial in a different way tax pros can help their clients protect themselves by sharing key bits of information on computer security these cyber smart tactics protect not only the tax professional but their client alike so we got those to look forward to this summer series runs for five weeks and coincides with the annual IRS nationwide forum which are being held virtually so it's a virtual forum still beginning July 19th everything's virtual now it doesn't matter COVID's done but it's all virtual still so the forums are featured I don't know if COVID's done whatever it's virtual so the forums feature three webinars focused on cyber and information security that will live streamed as follows so we got the cyber security for tax professionals advanced session presented by the American Coalition for Taxpayer Rights that's July 21st at 2 p.m. Eastern time deeper dive into emerging emerging cyber crimes and crypto tax compliance that's an interesting one July 26th at 11 a.m. Eastern time helping you and your your clients steer clear of fraud and scams presented by the Treasury Inspector General for Tax Administration August 2nd at 11 a.m. Eastern time for more information about the IRS nationwide tax forums and to register visit IRS nationwide tax forums and there's a link to that here there'll be a link to this in the description