March 29, 2018
Contact: Ron Leix, Treasury, 517-335-2167
Taxpayer Data Theft Up 60 Percent
Nationwide
LANSING, Mich. – The
Michigan Department of Treasury is joining the Internal Revenue Service, state
tax agencies and the tax industry to warn tax professionals to be on alert for
possible taxpayer data theft scams in the final weeks of the income tax filing
season.
“Tax professionals
should enhance their data safeguards immediately,” said Deputy State Treasurer
Glenn White, head of Treasury’s Tax Administration Group. “Nationally, there
has been a rise in cybercriminal thefts of taxpayer data from tax
professionals. By reviewing internal controls, creating a data security plan
and being cyber vigilant, tax professionals can take a stand against these criminals.”
So far this filing
season, the Internal
Revenue Service is reporting a steep upswing in the number of
reported thefts of taxpayer data from tax practitioner offices. Across the
nation, 75 firms have reported taxpayer data thefts in January and February,
nearly a 60 percent increase from the same time last year.
Much of this increase
follows one scam—the
erroneous refund scheme—that affected thousands of
taxpayers and numerous practitioners earlier this filing season.
January through April
is the prime season for cybercriminals to attack tax practitioners, but data
thefts can occur at any time. Tax professionals should be on high alert and implement
strong security measures as the April 17 deadline
approaches.
Cybercriminals try to
take advantage of this extremely busy time of the year when tax professionals
are in greater contact with taxpayers and are in possession of more data.
Signs that tax
professionals may be a victim of data theft include:
- Client e-filed returns begin to
reject because returns with their Social Security numbers were already
filed;
- The number of returns filed with tax
practitioner’s Electronic Filing Identification Number (EFIN) exceeds
number of clients;
- Clients who haven’t filed tax
returns begin to receive authentication letters (5071C, 4883C, 5747C) from
the IRS;
- Network computers running slower
than normal;
- Computer cursors moving or changing
numbers without touching the keyboard;
- Network computers locking out tax
practitioners.
Tax professionals who
experience a security incident or a breach resulting in data disclosure should immediately
report the incident to the Internal
Revenue Service and Michigan
Department of Treasury.
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