written by Olivia Tinkler
After a challenging year of identity theft with the IRS, 2016 should be the start to many needed improvements taxpayers have been asking for. This 2016 filing season, the IRS has additional monetary resources to improve customer service and cybersecurity along with curbing identity theft. Congress approved the fiscal year 2016 omnibus spending bill which was signed in to law by President Obama in December. This bill allocates $290 million in additional funding to the IRS as compared to the 2015 budget. The focus of these funds are to improve customer service, tax-related identity theft and related fraud, and cybersecurity.
Lawmakers became aware of the customer service challenges at the IRS over the course of several hearings during 2015. IRS Commissioner John Koskinen and other officials said that the agency “had to do more with less.” Speaking in November, Koskinen said that without more funding, customer service would be worse in 2016.
With more than 60 percent of all calls to the IRS left unanswered during 2015 (according to the National Taxpayer Advocate, “NTA”), many taxpayers and professionals alike were left very frustrated. The NTA also reported that the average wait time to speak with an IRS employee stretched past 20 minutes with an increased use of the so-called “courtesy disconnects” in order to handle the overloaded phone lines. This was undoubtedly aggravating for the IRS reported 2.7 million taxpayers who were victims of identity theft for the 2014 filing year.
The 2016 omnibus spending bill authorizes more funding for 1-800 help line services for taxpayers. Congress directed the IRS to make improving telephone service a priority and to enhance response times.
Tax-related identity theft typically goes unnoticed until the taxpayer files their legitimate return and it is rejected by the IRS. The return is rejected because the criminal uses the personal identification information of a taxpayer (most of this information can be extracted from a W-2 alone) to file a return claiming a fraudulent refund. Typically, refund fraud occurs early in the filing season.
In response, the IRS has continuously upgraded its processing filters to uncover fraudulent returns. The agency has also partnered with state tax authorities and private sector tax software vendors and launched public education campaigns about tax-related identity theft. The FY 2016 omnibus authorizes more funding to improve the identification and prevention of tax-related identity theft and refund fraud.
If you would like to read tips on how to protect yourself from tax-related fraud, please visit the IRS Website – Identity Protection for valuable tips and suggestions.
The IRS has an online app called “Get Transcript” that enables taxpayers to obtain line-by-line return information. In 2015, the IRS acknowledged the fact that cybercriminals hacked and made quick use of this online service to commit fraud and file false returns.
The increase in the IRS’s budget aims to further protect taxpayers from this kind of criminal activity and ease as much pain and complication as possible during the filing season.
If you have any additional questions related to identity theft or other tax-related crimes, please contact our office at 417-881-0145; we would be delighted to make this tax season a little less stressful for you.