As you would expect, we keep a very close eye on any news regarding the IRS. The IRS has released a news statement that identity thieves were able to gain access to the Tax Return Transcripts available to individual taxpayers through the IRS's online "Get Transcript" system. Nearly 104,000 transcripts were obtained and the identity thieves attempted to obtain approximately 100,000 more.
The type of transcripts that were taken give line-by-line information regarding income and deductions that were claimed on the tax return for that year (the year the transcript was requested for). The information available on the transcript does not provide any bank account or routing numbers, but it does contain details like the "Adjusted Gross Income" on the tax return, which is often used as a verification measure for other IRS systems and in applying for loans.
The more disturbing issue that this raises for any of the people whose accounts were accessed is the amount of data that these identity thieves already had. In order to gain access to the "Get Transcript" program, these people would have already have had access to the Social Security numbers, date of birth, tax filing status, and street address (plus other undisclosed security questions) for any of the people they were targeting. So, it is quite likely that these identity thieves already had more than enough information to do other things, like opening credit cards fraudulently, for the people who were victims of this scheme.
The IRS has been very clear in announcing that none of its systems were "hacked" and that it does not appear as if any of the other systems the IRS has, either internal or available for public use, were affected. If you would like to see more details about this, here is a link to the IRS News Release: http://www.irs.gov/uac/Newsroom/IRS-Statement-on-the-Get-Transcript-Application
For now, the IRS has disabled the "Get Transcript Application" and is continuing to identify all of the people whose transcripts were obtained as well as those where the attempts to obtain the information failed. The IRS will also be issuing letters to all of those affected and be offering one year of credit monitoring services to any of the people whose transcripts were obtained. If you receive one of these letters, please make sure that you review the information thoroughly.
If you were one of the individuals affected by this scheme, the IRS will indicate on your IRS accounts that you were a victim of identity theft and put measures in place to help protect your information and avoid the processing of fraudulent returns for the 2015 and 2016 tax years. Unfortunately, these protection measures have the side effect of making it more difficult and time consuming to obtain information from the IRS and to process your tax returns for the next year or two.
Steps You Should Take
If you haven't been doing this already, you should make it a practice to check your credit report at least once per year (and preferably more often) to make sure that there is no suspicious activity, such as credit cards being opened that you did not open. There are plenty of free resources you can use to check your credit report and each of the three major credit reporting agencies allows the ability to check your credit report annually for free. Credit Karma is actually free.
You should also take steps to keep your online activities as secure as possible. Set strong passwords for your online accounts and change them frequently. You should always be on the look out for suspicious websites or phishing scams that attempts to get your information via email or telephone.
Finally, you should be very careful with any documents or information that contain sensitive information that you store or exchange with people electronically. For example, email is the least secure way to exchange documents and information with people, and sending bank statements or tax returns via email makes it far more likely that this information will get into the hands of identity thieves.
If you think that you have been the victim of identity theft, the Federal Trade Commission has some excellent resources to help you through the process of getting the issue rectified. https://www.ftccomplaintassistant.gov/Information?OrgCode=IRS#crnt&panel1-2.
