Tax Reform Friday: National Taxpayer Security Awareness Week is a Sign of the Times


The IRS, state revenue departments, and the tax industry sponsored the third annual National Security Awareness Week from Dec. 3 through Dec. 7, 2018. There is collective concern about the security of taxpayer data as we approach the first post-tax reform filing season. The purpose of this effort is to remind people to beware of tax scams, be careful during the holiday shopping season, and to generally be vigilant in protecting their personal data.

Every day this week, the IRS released a Tax Tip on a different security issue that included a description of the security risk and tools that taxpayers can use to protect themselves against the risk. The security risks addressed were shopping online; phishing scams; password complexity; W-2 scams; and tax preparer protection strategies. The IRS also offered a free webinar about the dark web, which is used by cybercriminals to store and trade stolen data. 

Similarly, state revenue departments circulated news releases and bulletins this week encouraging taxpayer vigilance in data and identity protection. The New York Department of Taxation and Finance shared that taxpayers can secure their personal information using these five strategies

  1. Verify that websites are secure to protect your computer

  2. Use strong passwords

  3. Use secure wireless networks

  4. Regularly review bank account and credit card statements

  5. Review your credit reports each year 

New York also released a bulletin with information on ways that thieves scam taxpayers, such as threatening calls and phishing emails, and provided details on some department practices that should help taxpayers recognize identify such scams. Specifically, the department never requests personal or financial information by email nor does it require payments via prepaid debit cards or iTunes gift cards. 

The Arizona Department of Revenue provided recommendations on how to prevent identity theft, including using security software to protect electronics devices, using strong passwords, and safely discarding personal information. The Minnesota Department of Revenue gave tax preparers a to-do list for protecting their clients from data theft, including tracking their EFIN and PTIN usage weekly to ensure there have been no fraudulent filings. Their emphasis on tax professionals is fitting given IRS reports that there has been a significant increase in thefts reported by tax firms in 2018 over 2017.

When paper reigned, a cross-cut shredder was a significant deterrent to data theft; that taxpayers must now suppress their urge to click on email links, formulate impenetrable passwords, and worry whether websites are fake is just a sign of the times.

Continue the discussion on Bloomberg Tax’s State Tax Group on LinkedIn: Is it possible for taxpayers to truly protect our personal data, or are we too far gone?

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