voluntary IRS IP PIN?

[socca]

I'm debating whether to opt-in to the IRS IP PIN program. My overall goal is to minimize contact with the IRS (highly empowered agency + under-resourced = a nasty combination ). Acting proactively to greatly reduce the probability of someone successfully submitting a fraudulent tax return in my name might be worth doing. My tax info is more widely exposed than average thanks to business interests. Does anyone participate in this program?

P.S. Google says that the IRS made this program available for opt-in in 2021. Before, the IRS only issued an IP PIN to a taxpayer after identity theft.

 

[cathy63]

I deal with it from a preparer's point of view. The main thing is that the IP PIN is different every year and you always have to use the current one. So if you get one now, you will use it when you file your 2022 return, but you will also use it if you need to amend a prior return. Then next year you will get a new one to use for any transactions in 2024.

Also, you have to have a minimum income and be able to pass the identity verification to request a PIN online. If your income was too low, you'll have to send in a paper form to get one.

If you are married, then your spouse does not have to participate but if they do, they will have a different PIN than you do.

 

[socca]

My main counter-argument is that "it's just another thing to go wrong". Another counter-argument is that a huge number of fraudulent returns are filed each year, so presumably the IRS has a well-established procedure for handling this when it occurs. I've never had a fraudulent return filed in my name, and supposedly the IRS is getting better at detecting an attempt to file a fraudulent return. Right now, I'm leaning toward not opting-in to the IP PIN program, but it's an interesting idea.

 

[Car-Guy]

I've been using a PIN for the past few years. No issues, except, I always worry about my new pin being lost in the mail each year. So far so good.

 

[socca]

... I always worry about my new pin being lost in the mail each year. So far so good.

The IRS has an on-line tool for IP PIN retrieval. Presumably you need an an online account with the IRS to use it. I have an online IRS account, but it was obtained before the ID.me rigamarole. As of a couple of months ago I could still get into my IRS account using the old credentials to have a look around.

 

[Car-Guy]

^^^^^
Some day we may all be required to have one, but until then I'd prefer not to have an on-line account with the IRS

Having accounts with the SSA and Medicare is one thing, but the IRS

 

[socca]

Some day we may all be required to have one, but until then I'd prefer not to have an on-line account with the IRS Having accounts with the SSA and Medicare is one thing, but the IRS

Being able to log into my dad's IRS account after he died to make sure that he was up-to-date with all of his filings from the IRS's point-of-view was useful. However, this thread is about the IRS IP PIN, not the IRS account, so I won't derail it.

 

[truenorth418]

Don’t do it.

I “opted in” a couple of years ago.

Last year I accessed the PIN online, no problem.

This year I am currently locked out of my IRS account, many others having the same problem apparently, nobody at the IRS can explain why. Big mystery.

But now they will not mail me the PIN, and if my account access is not returned to me by the time I want to file my taxes, I will have to file a paper return - and wait extra long as they apply extra security checks on my returns because now I am on their “PIN” list.

As one of the others said, just another thing to go wrong.

 

[socca]

... But now they will not mail me the PIN ...

If you call the 800 number on this page perhaps the IRS will re-issue your PIN and mail it to you. Considering what's happening at the IRS these days it's worth doing everything possible to avoid a paper filing.

 

[dixonge]

Several years ago I filed a delayed return for the prior year alongside the current year's return. That delay caused me a huge headache, because someone had fraudulently filed under my name for the prior year, getting almost $10k in tax refund. Had I filed on time, the fraudulent return would have been responsible for proving their identity. But since they filed first, *I* was responsible for proving *MY* identity.

In the end this required a lot of hassle and paperwork and I ended up turning it over to the Taxpayer Advocate's office. The main end result of this was that my own meager refund was delayed over a year and I now get an IRS PIN # for every year's return. It is a minor hassle but well worth it for the peace of mind factor...

 

[Trooper]

Maybe I am naive, but I have been using one for the past three years or so without issue. Main impetus was watching a friend go through h*'ll after a fraudulent return was filed in his name.

I have an online account with the IRS, so no mail issues. I have not experienced the lockout issue described above by truenorth; however I have not started my 2022 return yet.

Note to those considering one: Once you're given a PIN by the IRS, you must use it to file your return otherwise the return will be rejected.

 

[jazz4cash]

Have been using for many years with no issues. I did not realize I would need the IP PIN to file an amended return. We obtained the IP PINs after being alerted by our State Comptroller that fraudulent returns had been filed. Keep in mind that if your status is MFJ each spouse is issued a unique IP PIN each year.

 

[Sojourner]

I'll admit to not knowing much about how tax-return fraud works, but my question is: Why would a PIN be any better than having to know your previous year's AGI in order to file? My tax filing software always asks for the exact prior year AGI and tells me the IRS will reject my return if I don't enter it exactly. How is that less secure than a PIN? And how do these fraudsters get ahold of people's AGI numbers for specific years?

 

[Trooper]

I'll admit to not knowing much about how tax-return fraud works, but my question is: Why would a PIN be any better than having to know your previous year's AGI in order to file? My tax filing software always asks for the exact prior year AGI and tells me the IRS will reject my return if I don't enter it exactly. How is that less secure than a PIN? And how do these fraudsters get ahold of people's AGI numbers for specific years?

Good question, but I suspect the fraudsters are filing manually?

In any case, I don't mind having to enter both my PY AGI and a PIN...to me it's like 2 factor authentication.

 

[dixonge]

Good question, but I suspect the fraudsters are filing manually?

Exactly. And once a PIN is assigned no return will be accepted without one, no matter how you file. And since fraudulent filers don't use their real address (which would be stupid) and have the refund deposited to a bank account (which they quickly close, and which was probably opened in the name of the defrauded taxpayer, using a fake ID, I would guess?) the PIN will catch them.

 

[socca]

... I have been using one for the past three years or so without issue. Main impetus was watching a friend go through h*'ll after a fraudulent return was filed in his name. ...

I can modify my conjecture above to:

... so presumably the IRS has a well-established h*llish procedure for handling this when it occurs.

Still planning to skip it this year, but am keeping an open mind.

 

[Sojourner]

Good question, but I suspect the fraudsters are filing manually?

Wow... really? So they're actually sending in paper forms, including fake W-2s and 1099s, etc.? Incredible that the IRS cannot spot the vast majority of these fakes by doing simple comparisons with previous year returns.

 

[cathy63]

You don't need the prior year AGI to e-file if the prior return hasn't yet been processed or if you didn't have a filing requirement (you enter $0 in that case). You also don't need a prior year AGI for returns that are prepared by professional filers such as the storefront tax shops or VITA/TCE/AARP sites. Of course they are supposed to verify SSNs for every person named on a return and see a photo ID for all adults, but that may not always happen. I suspect a lot of fraudulent e-files got through during Covid when the IRS had a huge backlog of unprocessed paper returns.

As of late Dec, the IRS backlog was down to 400K original paper returns and less than 1.5M amended paper returns, but they still have 2.9M cases of identity theft to deal with. (source: https://www.irs.gov/newsroom/nation...xpayer-impact-of-processing-and-refund-delays)

I would recommend e-filing as soon as you have all your docs, even if you owe money. You can always schedule the payment for April 18th (or May 15th if you live in a federally declared disaster area in CA, GA, AL) even if you file in Feb.