Cyberhackers Force IRS To Abandon PIN E-Filing System

As a precautionary step to protect taxpayers, the Internal Revenue Service announced 23 June 2016 that the electronic filing PIN tool is no longer available on IRS.gov or by toll-free following additional questionable activity.

In February, the IRS announced that cyber criminals using taxpayer data, stolen elsewhere, and an automated bot attack program accessed more than 100,000 e-File PINs through the tool. The tool only reveals the PIN; it does not reveal any taxpayer data. Criminals used taxpayers’ names, addresses, filing status, dates of birth and Social Security Numbers which they obtained from other sources to access the e-File PIN.

The IRS retained the tool at that time because links are embedded in almost all commercial tax software products that helped taxpayers file their returns. However, additional defenses were added inside the IRS processing systems for protection, including extra scrutiny for any return with an e-File PIN.

Recently, the IRS observed additional automated attacks taking place at an increasing frequency, but only affecting a small number of e-File PINs. We were able to identify this issue because of additional defenses put in place earlier this year, and backend protections remain in place. However, the IRS decided to remove the e-File PIN program as a safety measure. Prior to this, the IRS had been working with industry to assess elimination of the e-File PIN later this year.

The e-File PIN serves as an alternative signature verification method on the Form 1040 series and helps assist with electronic filing of tax returns. Most taxpayers do not need an e-File PIN to file electronically, they can use their prior-year adjusted gross income from copies of their prior year tax returns.

William H. Byrnes has achieved authoritative prominence with more than 20 books, treatise chapters and book supplements, 1,000 media articles, and the monthly subscriber Tax Facts Intelligence. Titles include: Lexis® Guide to FATCA Compliance, Foreign Tax and Trade Briefs, Practical Guide to U.S. Transfer Pricing, and Money Laundering, Asset Forfeiture; Recovery, and Compliance (a Global Guide). He is a principal author of the Tax Facts series. He was a Senior Manager, then Associate Director of international tax for Coopers and Lybrand, and practiced in Southern Africa, Western Europe, South East Asia, the Indian sub-continent, and the Caribbean. He has been commissioned by a number of governments on tax policy. Obtained the title of tenured law professor in 2005 at St. Thomas in Miami, and in 2008 the level of Associate Dean at Thomas Jefferson. William Byrnes pioneered online legal education in 1995, thereafter creating the first online LL.M. offered by an ABA accredited law school (International Taxation and Financial Services graduate program).

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