Identity Theft: Expanded efforts at IRS protect taxpayers and fight fraud. Ley Mills IRS COSS SL/Field November 12, 2014

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1 Identity Theft: Expanded efforts at IRS protect taxpayers and fight fraud Ley Mills IRS COSS SL/Field November 12, 2014

2 Identity theft is a serious threat Federal Trade Commission hears from more than 20,000 consumers per week whose identities have been stolen Repercussions from identity theft are far-reaching; can include tax-related issues

3 2013 successes Resolved and closed 963,000 cases of taxrelated identity theft Suspended or rejected 5.7 million suspicious returns worth $17.8 billion Issued 1.2 million IP PINs to protect taxpayers for the 2014 filing season

4 IRS initiatives fight identity theft and assist victims Identity Protection Personal Identification Numbers (IP PINs) E-Authentication New program guidance addressing business identity theft Online fraud detection and prevention

5 2013 updates strengthen IP PIN Current year IP PIN now useable on prior-year returns filed during calendar year Spouses use IP PIN when e-filing Easier to replace lost IP PIN into retrieve original IP PIN; IPSU for a replacement IP PIN ( ext. 245)

6 Pilot effort extended IP PIN use IP PIN pilot program / e-authentication Voluntary program for Florida, Georgia and D.C. taxpayers to opt-in to IP PIN Taxpayers who get e-file PIN through IRS.gov application get the offer Requires online registration and identity validation through e-authentication

7 Addressing business identity theft Business identity theft: Creating, using or attempting to use business identifying information without authority to obtain tax benefits New IRS program guidance focuses on research, identification, tracking and victim assistance

8 Addressing business identity theft Initial steps for victims: Report to local law enforcement Contact major business credit bureaus Contact all credit card companies, financial institutions and other creditors Respond to IRS notices immediately

9 Mitigating online fraud IRS Office of Online Fraud Detection and Prevention investigates sites that purport to be the IRS, use its logos, etc. Works to mitigate risks to taxpayers Please report suspicious IRS-related s to

10 OFDP efforts get results OFDP collaborates with other federal/law enforcement agencies In 2013, OFDP helped stop a $160 million advance-fee scheme involving criminals around the globe

11 Recent projects, partnerships SSN masking and 2D barcode system for IRS notices, letters 20.4 million so far States' Suspicious Filers Exchange to automate referrals $8.5 million stopped Criminal Investigation/State MOU to exchange identity theft data, joint compliance efforts 26 states to date

12 You play a critical role IRS collaborates and exchanges info with other agencies and financial institutions to prevent identity theft We need your help to safeguard info and: Educate the public to be more vigilant Help businesses understand their role in protecting information

13 Find more at IRS.gov General identity theft info at including Taxpayer Guide to Identity Theft IP PIN info at Protection-PIN-IP-PIN (general info, IP PIN pilot, FAQs and online tool to replace an IP PIN)

14 Other resources Business identity theft Safeguarding info in your office information-compromise-andrisk-id-theftguidance-your-business

15 Appeals Mediation Programs Online Self-Help Tool Ley Mills IRS COSS SL/Field November 12, 2014

16 What is Mediation? Informal & flexible dispute resolution process Voluntary to both parties Nonbinding Appropriate when all issues fully developed Effective when both parties want resolution A chance to avoid lengthy appeal or costly litigation

17 Self-Help Tool on IRS.gov The tool is designed to explain the different mediation programs available, and will: Help you know when to discuss mediation with the IRS person assigned to your case Help you decide which mediation program best fits your needs Provide application instructions Visit IRS.gov and type mediation self help in the search box.

18 Online Self-Help Tool Screen Shot

19 Online Self-Help Tool Eligibility Basic program eligibility requirements: You want to resolve a tax dispute at the earliest opportunity; Your case is still under consideration with no letter received from IRS offering appeals rights; There are a limited number of disputed issues; You have provided IRS information to support your position.

20 Appeals Information on IRS.gov If this tool does not fit your needs, visit IRS.gov s Web page, What Can You Expect from Appeals? to learn more about the IRS Office of Appeals. Type What Can You Expect from Appeals into the IRS.gov search box.

21 IRS Review

22 Taxpayer Bill of Rights Ten broad categories: 1. Right to Be Informed 2. Right to Quality Service 3. Right to Pay No More than the Correct Amount of Tax 4. Right to Challenge the IRS s Position and Be Heard 5. Right to Appeal a Decision in an Independent Forum 22

23 Taxpayer Bill of Rights (cont.) Ten broad categories (cont.) 6. Right to Finality 7. Right to Privacy 8. Right to Confidentiality 9. Right to Retain Representation 10. Right to a Fair and Just Tax System 23

24 Collection Appeals Options Taxpayers can appeal most collection actions. Main options: Collection Due Process Collection Appeals Program 24

25 Offer in Compromise Five basic requirements: Filed all returns Made all required estimated taxes payments Current with federal tax deposits Can t pay full amount Not in bankruptcy 25

26 Offer in Compromise IRS may accept an offer on three grounds: Doubt as to liability Doubt as to collectability Effective tax administration 26

27 OIC Pre-Qualifier Tool The OIC Pre-Qualifier tool helps applicant s confirm eligibility and prepare preliminary proposals. 27

28 Offer in Compromise Components The completed offer package must include all of the following items: Form 433A or 433B Form 656 for each taxpayer $186 non-refundable fee Non-refundable payment 28

29 Audit Reconsideration Process used by IRS to help taxpayers when they disagree with the results of an IRS audit of their tax returns, or returns created for them by the IRS because they did not file tax returns as authorized by the Internal Revenue Code 6020(b). 29

30 Audit Reconsideration Process Step 1: Review examination report and attachments; determine which items you feel are incorrect Gather documentation needed to support your position Verify supporting documentation is information that has not been presented before; ensure it s for tax year in question 30

31 Audit Reconsideration Process Step 2: Make photocopies of documents and attach them to your letter explaining your request for reconsideration If available, attach copy of examination report, Form 4549, along with new documentation supporting your position Include a daytime and evening telephone number and the best time for us to call you 31

32 Contact information Name Ley Mills Phone Number (804) Address 32