As the 2016 individual tax season begins, we must be ever vigilant in protecting that most sensitive of information taxpayers’ PII. As a 2014 Pew Research Center study clearly demonstrates, Americans have real concerns about the institutional security of their personal information. As government agencies, we hold significant personal information on our citizens. It is incumbent upon us to be responsible for its security. And the public is not comforted by continued announcements of data breaches at major corporations and government bodies. One significant statistic from a 2015 Pew study suggests only “6% of adults say they are ‘very confident’ that government agencies can keep their records private and secure, while another 25% say they are ‘somewhat confident.'”
As departments of revenue work to increase protections from identity theft and tax refund fraud, we often engage our taxpayers as part of the solution. In Indiana, we identified the epidemic of identity theft and tax refund fraud three years ago. We now engage our taxpayers as part of the solution, using tools that allow us to identify questionable, or suspicious, tax returns. When identified, taxpayers are asked to confirm their identities using an online, or optional telephonic, “identity confirmation quiz.”
This process is a positive step and key effort in helping us help taxpayers protect themselves, while at the same time protecting state revenues from tax refund fraud. Enlisting the assistance of every player in the system, including CPAs, Enrolled Agents, vendors, etc., we have communicated extensively with taxpayers about this process. As a result, we have seen significant successes with little public concern. Indeed, many taxpayers report appreciation that we are part of a solution, not a part of the problem!
The lesson?
- Be a part of the solution,
- be perceived as part of the solution,
- and, engage your citizens by explaining what you are doing and why.
