Taxpayer identity fraud is the second issue in this three-part blog digging into the defining issues of TY2014
Taxpayer identity fraud
Recap: In the face of increasing cyber security issues threatening the entire tax system, public and private entities are charged with partnering to strengthen and safeguard the integrity of the process.
The cyber fraud toll on the nation as a whole is significant, with an estimated $5 billion in fraudulent payments and an estimate $25 billion of prevented fraud in 2014. The increasing incidence in taxpayer identity fraud also dilutes confidence in the tax administration process and inflicts enormous costs on individual victims.
To proactively address the increasingly sophisticated cyber fraud threats, the IRS launched a Security Summit in the spring to bring together government officials from the IRS, representatives from State Departments of Revenue, and tax industry leaders. On June 11th IRS Commissioner Koskinen announced the first outcomes of the Security Summit – a three-part strategic framework for a public-private partnership that will guide near and long-term approaches to stopping taxpayer identity fraud and safeguard the tax system. Also announced was a comprehensive memorandum of understanding that lays out initial approaches to a coordinated anti-fraud program.
As more and more of us live socially and transact financially in an increasingly online and electronic world, the threat of identity-based cyber fraud is pervasive. The collaborative engagement between government and the tax industry is an opportunity to solve an industry–wide issue and perhaps offer a model of how other sectors can mitigate risks going forward.
Check back next week for TY14 Recap Part 3 on economic security.