Watchdog: IRS Fails to Provide IP PINs to Eligible Taxpayers – Los Angeles Income Tax Planning & Income Tax Litigation Attorney Bruce Givner

by Bruce Givner on November 6, 2014

According to a recent report published by the Treasury Inspector General for Tax Administration (TIGTA) on October 28, the Internal Revenue Service (IRS) failed to provide taxpayers who have been victims of identity theft with Identity Protection Personal Identification Numbers (IP PINs). This is despite the fact that the number of IP PINs issued by the IRS rose by more than 55% this year.

The TIGTA report states that the IRS failed to provide IP Pins to 532,637 eligible taxpayers, including 24,628 individuals whose personally identifiable information (PII) was lost or breached, and who therefore represent potential victims of identity theft.

In 2014, the IRS issued 1.2 million IP PINs, up from just 770,000 in 2013. However, TIGTA argues that the IRS should have issued even more. The TIGTA report recommends that the IRS make it possible for taxpayers whose information has been stolen to request an IP PIN on the IRS website. This is already the case, according to the IRS, but TIGTA begs to differ.

“Our review of the IRS’s website for its online IP PIN application determined that it still has not been updated to inform these taxpayers of their eligibility to obtain an IP PIN…These taxpayers are unaware of their ability to obtain an IP PIN until the IRS notifies them beginning in January 2015,” the report states.

The IRS’s response to this criticism is twofold. First, the IRS made clear that the IP PINs are just one part of a larger initiative to combat identity theft. “It is important to clarify that while TIGTA highlights a group of 530,000 taxpayers that did not receive IP PINs, those were taxpayers identified by the IRS as having potentially suspicious activity on their accounts, rather than taxpayers that self-reported to the IRS,” the IRS said in a statement.

Second, the IRS made clear that the current strict provisions regarding which taxpayers receive IP PINs will be relaxed in the future. “In this coming year, taxpayers identified by the IRS as having possible suspicious activity on their accounts will receive a letter inviting them to take part in our IP PIN program,” the IRS said.

The IRS further emphasized that one of the problems causing fewer taxpayers to receive IP PINs than were eligible is budget cuts to the agency and staff shortages.

Givner & Kaye focuses on sophisticated income tax planning and compliance, tax litigation and procedure, estate planning, and asset protection plans for individuals and businesses in Beverly Hills, Calabasas, West Los Angeles, Hollywood, and other areas of Los Angeles, Orange, Ventura, San Bernardino, Riverside and Santa Barbara Counties. Call Los Angeles Estate Planning and Asset Protection Plan Attorneys Givner & Kaye at (310) 207-8008 today.


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