The IRS recently made some announcements to inform taxpayers about obtaining an Identity Protection Personal Identification Number (IP PIN) that may help protect against tax-related identity theft. Here is a summary of the IP PIN.
What is it?
The tax identity protection PIN or IRS Identity Protection PIN (IP PIN) is a 6-digit number assigned to taxpayers in efforts to prevent the misuse of their Social Security number on fraudulent federal income tax returns and protect the taxpayer. If the person was a confirmed victim of tax-related identity theft and the tax agency resolved these tax issues, the IRS may have already mailed a CPO1A Notice assigned the taxpayer an IP PIN.
In the past, only taxpayers that were victims of identity theft were able to get the IP PIN. This year, any taxpayer may apply for an IP PIN. This is a free service.
Tax identity theft occurs when someone uses another person’s information to fraudulently file a tax return. When these thefts are not detected, the fraudsters may be able to steal the tax refund of the victim. The taxpayer will still be able to claim their tax refund. When a taxpayer is a victim of this type of fraud, filing a tax return becomes more complicated. These types of tax-related thefts are less common than other types of identity thefts however there was an increase in 2020.
How to get the PIN
If the taxpayer was a victim of tax identity theft, the IRS may have already assigned the taxpayer an IP PIN. Typically, the IRS will mail the IP PIN to the taxpayer. Each year in either December or January, the IRS will automatically mail the taxpayer a new IP PIN when the taxpayer is registered in the system. If the taxpayer was not a victim of tax identity theft and wishes to get an IP PIN, the best way to do this is by visiting the IRS website. The following information will be needed to process the request: email, tax identification number, mailing address, tax filing status, financial account number tied to the taxpayer (examples – credit card, student or auto loan, mortgage), and an activation code that’s mailed to the taxpayer or sent via mobile phone that is registered in taxpayer’s name.
The online tool is the quickest way to get the IP PIN. After the taxpayer completes the process online, the IP PIN is immediately sent. The IP PIN is valid for one year. Each year, the taxpayer will need to request a new one. Visit Get An Identity Protection PIN | Internal Revenue Service (irs.gov) to get an IP PIN. Once the taxpayer enrolls in this program, they will need to use it on their tax return otherwise the return will not be processed. Every year, the taxpayer will need to get a new IP PIN to ensure that their tax return will not be rejected. This annual IP PIN is ONLY sent to the taxpayer via mail. The IRS will not call or email the taxpayer.
More Information About the IP PIN
The IRS has a section on its website of Frequently Asked Questions that may be helpful and provides additional detail about this process. Visit Frequently Asked Questions about the Identity Protection Personal Identification Number (IP PIN) | Internal Revenue Service (irs.gov)
Other Strategies for Tax Identity Prevention
File tax return early. Use strong passwords to protect personal information. Don’t share IP PIN. Periodically check credit reports. Be alert to phishing schemes. Keep close watch of mail. Protect mobile devices. Monitor financial and medical statements.
For information about COVID-19 tax and business implications, visit this special section of our website.