IRS beefs up identity verification for online self-help

The Internal Revenue Service is strengthening the identity verification and sign-in process for its online self-help tools after a number of high-profile data breaches.

Taxpayers using the new verification procedure introduced Wednesday can use existing IRS online services, such as the Child Tax Credit Update Portal, Online Account, Get Transcript Online, Get an Identity Protection PIN (IP PIN) and Online Payment Agreement. The IRS plans to transition more of its apps to the new authentication procedure over the next year.

The IRS has also integrated its new account-creation process into some of the apps used by tax professionals, including those used to request powers of attorney or tax information authorizations online using Tax Pro Account or to submit Forms 2848 and 8821 online.

In 2015, the IRS was forced to remove its Get Transcript app in the middle of tax season after finding that identity thieves had used it to get access to the transcripts of hundreds of tax returns. It relaunched the app in 2016 with improved authentication procedures (see story). Similar problems were found with the IP PIN app and others where the IRS needed to improve the authentication (see story).

The IRS has increasingly relied on self-help tools as much of its support staff has been sidelined during the pandemic, leading to longer wait times on hold and disconnected phone calls. At the same time, the IRS has needed to respond to new government stimulus programs like the enhanced Child Tax Credit monthly payments with even more self-help tools that can provide cybercriminals with potentially lucrative targets of identity theft. That spurred a greater need for better authentication procedures, as cyberthieves have come armed with more identifying information they have gained from data breaches at other sources, including tax preparer systems.

“Identity verification is critical to protect taxpayers and their information,” said IRS Commissioner Chuck Rettig in a statement. “The IRS has been working hard to make improvements in this area, and this new verification process is designed to make IRS online applications as secure as possible for people. To help taxpayers and the tax community, we are improving the accessibility of online tools that help families manage their Child Tax Credit, check on their IRS accounts and securely perform other routine tasks online.”

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The IRS hopes the new process will be able to reach more taxpayers by expanding the use of identity documents and increasing help desk assistance for taxpayers who run into problems when trying to verify their identity online. The new process was developed under the IRS’s Secure Access Digital Identity initiative to comply with a federal mandate.

To offer its new verification services, the IRS is turning to ID.me, a security technology contractor, in an effort to make sure sensitive taxpayer information is given only to the person who legally has a right to the data.

Taxpayers who want to access the online tools will be asked to sign in with an ID.me account. Those who already have IRS usernames can continue to use their credentials from the old system to sign in until next summer, but they will still be prompted to create an ID.me account as soon as possible. Anyone who has an existing ID.me account from the Child Tax Credit Update Portal, or from another government agency, can sign in with their existing credentials.

In order to verify their identity with ID.me, taxpayers will need to upload a photo of an identity document such as a driver’s license, state ID or passport. They will also need to take a selfie using a smartphone or a computer with a webcam. Once their identity has been verified by the IRS and ID.me, they can securely access IRS online services.

Taxpayers who need assistance verifying their identity or submitting a support ticket can visit the new ID.me IRS Help Site.

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Tax IRS Identity verification Identity theft protection Charles Rettig
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