IRS Turns Hacked Application Back On -- This Time with Added Security Features

The Internal Revenue Service headquarters building in Washington.

The Internal Revenue Service headquarters building in Washington. J. David Ake/AP File Photo

The announcement came just a day before the release of a new report that revealed the IRS did not identify all taxpayers whose sensitive tax information may have been improperly accessed by cybercriminals.

The Internal Revenue Service announced Tuesday that an online application exploited by fraudsters last year and yanked offline is available again -- with added security features.

If taxpayers want to use the “Get Transcript” feature to download prior years’ tax returns, they’ll have to provide more detailed financial information -- such as a credit card number in their name -- and they’ll receive codes texted to their cellphones to confirm their identities.

The announcement came just a day before the release of a new report from the agency’s inspector general, which revealed the IRS did not identify or offer assistance to all taxpayers whose sensitive tax information may have been improperly accessed by cybercriminals.

All told, tax information on 390,000 taxpayers was potentially exposed to hackers, the IRS has said, while hundreds of thousands of additional accounts were targeted.

Taxpayers who want to use the revamped application to download tax transcripts will now receive email confirmation codes, which they’ll have to enter along with their Social Security number, date of birth and some tax-related questions. Taxpayers will have to provide some financial account information, such as the last eight digits of a credit card number or a home mortgage account number. Users will also have to provide a cellphone number to receive a six-digit activation code via text message to activate their accounts.

The IRS worked with the U.S. Digital Service to patch up the security of the application. The White House’s tech fix-it squad was created in 2014 in the aftermath of the HealthCare.gov debacle to help turn around bungled federal IT projects. The IRS says the new sign-on measures meet security standards developed by the National Institute of Standards and Technology.

Part of the problem with the old system was that it used what is known as “knowledge-based authentication” -- asking your mother’s maiden name, for example, or the street you grew up on or your favorite movie. The answers to those questions can frequently be found by savvy hackers on social media or simply guessed, especially as they amass tons of information from previous hacks.

“Criminals are becoming increasingly sophisticated and continue to gather vast amounts of personal information as the result of data breaches at sources outside the IRS,” IRS Commissioner John Koskinen said in a statement. "In the face of that threat, we must provide the strongest possible authentication processes, while trying to enhance the ability of taxpayers to legitimately access their data and use IRS services online.”

However, because of the enhanced security features, some legitimate users may find it more difficult to access the service, the agency acknowledged. Taxpayers can still order copies of their transcripts via phone or online.

“The incident with Get Transcript Online illustrates a wider truth about identity theft in general, which is that there are no perfect systems,” Koskinen said. “No one, either in the public or private sector, can give an absolute guarantee that a system will never be compromised.”

In a May 16 IG report, publicly posted online today, auditors say the IRS botched initial efforts to identify and offer assistance to taxpayers affected by the Get Transcript breach.

After initially estimating information from 100,000 taxpayer accounts had been exposed, the IRS repeatedly revised the estimate upward. Earlier this year, based on input from a preliminary IG audit, the agency acknowledged fraudsters had actually potentially accessed some 390,000 taxpayer accounts. An additional 295,000 accounts were targeted but not successfully downloaded.

Overall, the IG’s review, which was conducted between June 2015 and January of this year, uncovered about 620,000 users whose tax information involved potentially unauthorized access not previously identified by the IRS.

The IG also said the agency didn’t place “identity theft markers” on the tax accounts of some 3,200 of the taxpayers initially identified as victims of the breach. Those markers would have alerted IRS employees assisting taxpayers those accounts were affected by the breach.

In a response to the audit, Debra Holland, commissioner of the agency’s wage and investment division, thanked the IG for helping identify all affected taxpayers, noting IRS resources at the time “were stretched thin in identifying and assisting the affected taxpayers.”

X
This website uses cookies to enhance user experience and to analyze performance and traffic on our website. We also share information about your use of our site with our social media, advertising and analytics partners. Learn More / Do Not Sell My Personal Information
Accept Cookies
X
Cookie Preferences Cookie List

Do Not Sell My Personal Information

When you visit our website, we store cookies on your browser to collect information. The information collected might relate to you, your preferences or your device, and is mostly used to make the site work as you expect it to and to provide a more personalized web experience. However, you can choose not to allow certain types of cookies, which may impact your experience of the site and the services we are able to offer. Click on the different category headings to find out more and change our default settings according to your preference. You cannot opt-out of our First Party Strictly Necessary Cookies as they are deployed in order to ensure the proper functioning of our website (such as prompting the cookie banner and remembering your settings, to log into your account, to redirect you when you log out, etc.). For more information about the First and Third Party Cookies used please follow this link.

Allow All Cookies

Manage Consent Preferences

Strictly Necessary Cookies - Always Active

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data, Targeting & Social Media Cookies

Under the California Consumer Privacy Act, you have the right to opt-out of the sale of your personal information to third parties. These cookies collect information for analytics and to personalize your experience with targeted ads. You may exercise your right to opt out of the sale of personal information by using this toggle switch. If you opt out we will not be able to offer you personalised ads and will not hand over your personal information to any third parties. Additionally, you may contact our legal department for further clarification about your rights as a California consumer by using this Exercise My Rights link

If you have enabled privacy controls on your browser (such as a plugin), we have to take that as a valid request to opt-out. Therefore we would not be able to track your activity through the web. This may affect our ability to personalize ads according to your preferences.

Targeting cookies may be set through our site by our advertising partners. They may be used by those companies to build a profile of your interests and show you relevant adverts on other sites. They do not store directly personal information, but are based on uniquely identifying your browser and internet device. If you do not allow these cookies, you will experience less targeted advertising.

Social media cookies are set by a range of social media services that we have added to the site to enable you to share our content with your friends and networks. They are capable of tracking your browser across other sites and building up a profile of your interests. This may impact the content and messages you see on other websites you visit. If you do not allow these cookies you may not be able to use or see these sharing tools.

If you want to opt out of all of our lead reports and lists, please submit a privacy request at our Do Not Sell page.

Save Settings
Cookie Preferences Cookie List

Cookie List

A cookie is a small piece of data (text file) that a website – when visited by a user – asks your browser to store on your device in order to remember information about you, such as your language preference or login information. Those cookies are set by us and called first-party cookies. We also use third-party cookies – which are cookies from a domain different than the domain of the website you are visiting – for our advertising and marketing efforts. More specifically, we use cookies and other tracking technologies for the following purposes:

Strictly Necessary Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Functional Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Performance Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Social Media Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Targeting Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.