For the second year in a row, the Electronic Tax Administration Advisory Committee (ETAAC) presented an annual report to Congress on June 27 emphasizing the importance of fighting identity theft tax refund fraud.  

As the IRS noted in a press release last week, “ETAAC…works in conjunction with the Security Summit, a joint effort of the IRS, state tax administrators, tax software providers, tax professionals, and financial service firms to fight fraud.” Understandably, the report underscored the pivotal role of the Internal Revenue Service and Security Summit in achieving several important victories during Filing Season 2017:

• 40% drop in the number of taxpayers self-reporting identity theft from the prior year
• 32% drop in the number of confirmed incidences of identity theft from the prior year
• 16% increase in recovered refunds

In addition to enumerating successes from last filing season, the ETAAC report recommended four broad areas for improving efforts against tax-related identity theft and fraud:

• Expand and strengthen the Security Summit and the ISAC (Information Sharing and Analysis Center)
• Strengthen the cybersecurity and tax ecosystem
• Improve identity theft tax refund fraud detection, analysis, and reporting
• Enable electronic tax services and electronic filing

Other ETAAC recommendations included asking Congress to sufficiently fund the IRS to meet these security goals and grant the agency the authority to regulate tax professionals.