Tax refund fraud is a concern now, more than ever, with the onset of COVID and scammers working full-time. Often, victims become aware of fraud after having their returns rejected – personal identifying information has been comprised. Up until now, the IRS has restricted who can apply for an Identity Protection PIN (IP PIN), a six-digit code good only for the tax year issued and known only to the taxpayer and to the IRS.
For the past few years, the IRS has issued IP PINs to some taxpayers as part of a multi-state experiment to determine if doing so might reduce the overall incidence of refund fraud. As a result of the success of the program, as of January 26, 2021, the IRS has expanded the Identity Protection PIN Opt-In Program to all taxpayers who are able to verify their identity. Here are some of the key things to know regarding the IP PIN Opt-in Program.
IP PIN Opt-In Program Key Points
- This is a voluntary program.
- Taxpayers must pass a rigorous identity verification process.
- Spouses and dependents are eligible for an IP PIN if they can verify their identities.
- An IP PIN is valid for a calendar year and a new one will be mailed for each filing season.
- The online IP PIN tool is not available between November and mid-January each year.
- Correct IP PINs must be entered on electronic and paper tax returns to avoid rejections and delays.
- Taxpayers should never share their IP PIN with anyone but their trusted tax provider.
- Beware of scams to steal IP PINs—the IRS will never call, text, or email requesting an IP PIN.
- Once you opt-in, there currently is no opt-out option, but the IRS is working on one for 2022.
- Current tax-related identity theft victims who have been receiving IP PINs by mail will experience no change.
How Can You Get Your IP PIN?
You can begin using your IP PIN in 2021, once you are verified on the get an IP PIN tool on IRS.gov. This tool uses Secure Access authentication to verify a person’s identity. Taxpayers should review the Secure Access requirements before they try to use the tool. In the past, IP PINs required the filing of an affidavit, however, there is now no need to file a Form 14039, Identity Theft Affidavit to join the program if you are enrolling for preventative measures. Upon authentication, your new 2021 IP PIN will be revealed, and your PIN must be used when prompted by electronic tax returns or written near the signature line on paper tax returns.
Can’t Verify Online?
For taxpayers who can’t verify their identity, or if your adjusted gross income is $72,000 or less, you may complete Form 15227, Application for an Identity Protection Personal Identification Number. Mail or fax it to the IRS and a customer service representative will contact you and verify your identity over the phone. You should have your prior-year tax return available for the verification process. If you verify your identity this way, an IP PIN will be mailed to you the following tax year. Once you are in the program, the IP PIN will be mailed to you each year. If you are still unable to verify both online or by phone and are you are ineligible for file Form 15227, contact the IRS to make an appointment to verify in person.
The benefits of the program are obvious. It will take time but enrolling in the IP PIN program provides additional peace of mind in unpredictable times. We encourage you to take some time to opt into the program for the 2021 tax year. Count on us to help safeguard your finances and personal information. You can contact Linda Bossard (email@example.com) with any questions about the IP PIN program.