23 Oct Americans face changes for 2016 tax season
Americans might want to budget a little more time for taxes next year.
Attempting to stem a spike in tax-refund fraud, the Internal Revenue Service, partnering with public and private tax administrators, said 20 new pieces of data will be used in tax returns in 2016. Tax preparation companies will share the information with the IRS and state agencies in an effort to combat an escalating problem that has already had returns falsely filed in the names of several million Americans.
The added security measures should not involve a “sea change” for taxpaying in filing returns electronically, Koskinen said in a news conference on Tuesday. Among the changes for taxpayers are likely to be more stringent passwords to access tax software, a new feature that will lock users out after a certain period of time and unsuccessful log-in attempts, and additional security questions.
The “20 data components will be largely invisible to taxpayers — we’re not interested in giving criminals a road map,” he said. “We’ll do a better job of stopping a refund before it goes out the door.”
The IRS said in May that criminals swiped information on 104,000 U.S. taxpayers from the agency’s website and used the data to file some 13,000 fake tax returns that cost about $39 million in refunds.