IRS and tax firms plan to team up in fighting fraud

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IRS announces new effort to work together with software and tax industry to stop identity theft and fraud.

The Internal Revenue Service announced last week that it has met with representatives from tax preparation and tax software firms to discuss efforts to cut down on the occurrence of fraud and identity theft. The announcement follows a recent online hacking of IRS systems that allowed $39 million in refunds to be diverted and taxpayers' personal information to be stolen.

"We have come to realize we are now dealing with a much more sophisticated enemy than in the past," says IRS Commissioner John Koskinen. “It’s clear that criminals have been able to gather increasing amounts of personal data as the result of ongoing data breaches at various sources outside the tax system.”

In addition to enacting new security protocols for spotting an array of fraud methods, the IRS plans to provide tax preparation firms with monthly anonymized reports on the latest fraud tactics being used by criminals.

Brad Smith, CEO of Intuit, makers of TurboTax, states that these new efforts "will be instrumental in helping to protect and serve legitimate taxpayers and safeguard their privacy." "For the first time, everyone in the software industry will share aggregated details about their filings to help us all identify fraud," adds Koskinen. "Changes are being built into the D.N.A. of the entire tax system."

Source: New York Times

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