IRS Tax News

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  • 09 Feb 2018 5:00 PM | Anonymous

    If your client has an expired Individual Taxpayer Identification Number (ITIN), he or she should renew it as soon as possible. Tax returns with expired ITINs will face processing delays, and affected taxpayers may lose eligibility for key tax benefits until they renew the ITIN.

  • 09 Feb 2018 4:59 PM | Anonymous

    IRS Publication 2043, IRS Refund Information Guidelines for the Tax Preparation Community, is now available for 2018. The publication provides the latest refund information and guidelines including specific information for your clients claiming the Earned Income Tax Credit or Advance Child Tax Credit.

    Please note, although the IRS issues most refunds in less than 21 days, it is possible some tax returns may require additional review resulting in delayed refunds.

  • 09 Feb 2018 4:58 PM | Anonymous
    With the surge of tax returns expected during the upcoming Presidents’ Day weekend, the IRS has several tips and various time-saving resources for tax pros to obtain help quickly and easily.
  • 09 Feb 2018 4:57 PM | Anonymous

    Following is an IRS statement issued today, Feb. 9:

    “The IRS is reviewing the legislation signed Feb. 9 that retroactively extended and modified numerous tax provisions covering 2017. We are assessing these significant changes in the tax law and beginning to determine next steps. The IRS will provide additional information as quickly as possible for affected taxpayers and the tax community.”

  • 09 Feb 2018 4:55 PM | Anonymous

    To help the tax community track information related to the Tax Cuts and Jobs Act (TCJA), the IRS has created a special page on IRS.gov to highlight provisions of the new law. The frequently updated page will include a "one-stop" listing of new legal guidance, news releases, Frequently Asked Questions, and other information related to TCJA.

    Tax professionals should bookmark the page and check it regularly for the latest information as the IRS works to implement changes.

  • 05 Feb 2018 10:09 AM | Anonymous

    WASHINGTON – Seeing the emergence of a new filing season scam, the Internal Revenue Service today urged tax professionals to step up security and beware of phishing emails that can secretly download malicious software that can help cybercriminals steal client data.

    Only a few days into the filing season, the IRS has already identified a new scam that began with cybercriminals stealing data from several tax practitioners’ computers and filing fraudulent tax returns.

    In a new twist, the fraudulent returns in a few cases used the taxpayers' real bank accounts for the deposit. A woman posing as a debt collection agency official then contacted the taxpayers to say a refund was deposited in error and asked the taxpayers to forward the money to her.

    This scheme is likely just the first of many that will be identified this year as the IRS, state tax agencies and tax industry continue to fight back against tax-related identity thieves. Because the Security Summit partners have made inroads against identity theft, cybercriminals have evolved their tactics to focus on tax professionals where they can steal client data.

    Thieves know it is more difficult to identify and halt fraudulent tax returns when they are using real client data such as income, dependents, credits and deductions. Generally, criminals find alternative ways to get the fraudulent refunds delivered to themselves rather than the real taxpayers.

    Tax professionals are reminded that there is a procedure for them to report data thefts to the IRS. They need only contact their state’s IRS Stakeholder Liaison, who will notify appropriate IRS officials and serve as a point of contact. All practitioners should review Data Theft Information for Tax Professionals for details about the process and the additional steps they should take.

    When notified immediately IRS can take steps to help protect taxpayers from tax-related identity theft. 

    IRS Criminal Investigation agents are still reviewing this latest data theft scam. However, the vast majority of data thefts occur because the tax preparer or someone in the office opened a phishing email and clicked on a link or attachment that contained malware. There are various forms of malware but some download secretly into computers and allow thieves to see each keystroke or give thieves remote access to computers. Both versions allow thieves to steal data stored on the computers.

    Tax professionals should review the Security Summit’s Don’t Take the Bait campaign, which outlined the various scams used by criminals to trick practitioners.

    Tax professionals are urged to seek cybersecurity experts to help better secure their data. Here’s a reminder of some basic steps tax professionals can take:

    • Educate all employees about phishing in general and spear phishing in particular.
    • Use strong, unique passwords. Better yet, use a phrase instead of a word. Use different passwords for each account. Use a mix of letters, numbers and special characters.
    • Never take an email from a familiar source at face value; example: an email from “IRS e-Services.” If it asks you to open a link or attachment, or includes a threat to close your account, think twice. Visit the e-Services website for confirmation.
    • If an email contains a link, hover your cursor over the link to see the web address (URL) destination. If it’s not a URL you recognize or if it’s an abbreviated URL, don’t open it.
    • Consider a verbal confirmation by phone if you receive an email from a new client sending you tax information or a client requesting last-minute changes to their refund destination.
    • Use security software to help defend against malware, viruses and known phishing sites and update the software automatically.
    • Use the security options that come with your tax preparation software.
    • Send suspicious tax-related phishing emails to phishing@irs.gov.

    This newest scam also serves as a reminder to taxpayers that they should be alert to any unusual activity such as receiving a tax transcript or tax refund they did not request. Please review the Taxpayer Guide to Identity Theft for appropriate actions. 

    Taxpayers who receive a direct deposit refund that they did not request should take the following steps:

    1. Contact the Automated Clearing House (ACH) department of the bank/financial institution where the direct deposit was received and have them return the refund to the IRS.
    2. Call the IRS toll-free at 800-829-1040 (individual) or 800-829-4933 (business) to explain why the direct deposit is being returned.
    3. Keep in mind interest may accrue on the erroneous refund.

    There is more information at Topic Number: 161 - Returning an Erroneous Refund.

  • 05 Feb 2018 10:01 AM | Anonymous

    As indicated in the IRS News Release #IR-2018-17, seeing the emergence of a new filing season scam, the Internal Revenue Service today urged tax professionals to step up security and beware of phishing emails that can secretly download malicious software that can help cyber-criminals steal client data. Only a few days into the filing season, the IRS has already identified a new scam that began with cyber-criminals stealing data from several tax practitioners’ computers and filing fraudulent tax returns. Please take a look for additional information.

  • 02 Feb 2018 2:40 PM | Anonymous

    Reminder: If you are an e-Services account holder, please re-register now through the more rigorous Secure Access authentication process. Additional toll-free personnel currently helping e-Services users soon will return to their primary jobs of assisting taxpayers.

    E-Services users who wait until they need immediate access to their account may encounter unexpected delays.  So far, 65,000 e-Services account holders already have successfully registered through Secure Access.

    To get started, first review Secure Access: How to Register for Certain Online Self-Help Tools to determine what you need to be successful and FAQs about e-Services and Secure Access, including common errors.

  • 26 Jan 2018 3:16 PM | Anonymous

    This is a reminder that wage statements and independent contractor forms must be filed with the government by January 31. This date applies to both electronic and paper filers.

    The Section 201(a) of the Protecting Americans from Tax Hikes (PATH) Act includes a requirement for employers to file their copies of Form W-2 and Form W-3 with the Social Security Administration by the end of January.

    This deadline also applies to certain Forms 1099-MISC filed with the IRS to report non-employee compensation payments in box 7.

    Early filing makes it easier for the IRS to verify income that individuals report on their tax returns and helps prevent fraud. Failure to file these forms correctly and timely may result in penalties.
  • 17 Jan 2018 12:07 PM | Anonymous

    WASHINGTON – The Internal Revenue Service, state tax agencies and the tax industry today urged all employers to educate their payroll personnel about a Form W-2 phishing scam that made victims of hundreds of organizations and thousands of employees last year.

    The Form W-2 scam has emerged as one of the most dangerous phishing emails in the tax community. During the last two tax seasons, cybercriminals tricked payroll personnel or people with access to payroll information into disclosing sensitive information for entire workforces. The scam affected all types of employers, from small and large businesses to public schools and universities, hospitals, tribal governments and charities.

    Reports to phishing@irs.gov from victims and nonvictims about this scam jumped to approximately 900 in 2017, compared to slightly over 100 in 2016. Last year, more than 200 employers were victimized, which translated into hundreds of thousands of employees who had their identities compromised.

    By alerting employers now, the IRS and its partners in the Security Summit effort hope to limit the success of this scam in 2018. The IRS last year also created a new process by which employers should report these scams. There are steps the IRS can take to protect employees, but only if the agency is notified immediately by employers about the theft.

    Here’s how the scam works: Cybercriminals do their homework, identifying chief operating officers, school executives or others in positions of authority. Using a technique known as business email compromise (BEC) or business email spoofing (BES), fraudsters posing as executives send emails to payroll personnel requesting copies of Forms W-2 for all employees.

    The Form W-2 contains the employee’s name, address, Social Security number, income and withholdings. Criminals use that information to file fraudulent tax returns, or they post it for sale on the Dark Net.

    The initial email may be a friendly, “hi, are you working today” exchange before the fraudster asks for all Form W-2 information. In several reported cases, after the fraudsters acquired the workforce information, they immediately followed that up with a request for a wire transfer.

    In addition to educating payroll or finance personnel, the IRS and Security Summit partners also urge employers to consider creating a policy to limit the number of employees who have authority to handle Form W-2 requests and that they require additional verification procedures to validate the actual request before emailing sensitive data such as employee Form W-2s.

    If the business or organization victimized by these attacks notifies the IRS, the IRS can take steps to help prevent employees from being victims of tax-related identity theft. However, because of the nature of these scams, some businesses and organizations did not realize for days, weeks or months that they had been scammed. 

    The IRS established a special email notification address specifically for employers to report Form W-2 data thefts. Here’s how Form W-2 scam victims can notify the IRS:

    • Email dataloss@irs.gov to notify the IRS of a Form W-2 data loss and provide contact information, as listed below.
    • In the subject line, type “W2 Data Loss” so that the email can be routed properly. Do not attach any employee personally identifiable information data.
    • Include the following:
    • Business name
    • Business employer identification number (EIN) associated with the data loss
    • Contact name
    • Contact phone number
    • Summary of how the data loss occurred
    • Volume of employees impacted

    Businesses and organizations that fall victim to the scam and/or organizations that only receive a suspect email but do not fall victim to the scam should send the full email headers to phishing@irs.gov and use “W2 Scam” in the subject line.

    Employers can learn more at Form W-2/SSN Data Theft: Information for Businesses and Payroll Service Providers.

    Employers should be aware that cybercriminals’ scams constantly evolve. Finance and payroll personnel should be alert to any unusual requests for employee data.

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