The IRS Identity Protection PIN: A Shield Against Identity Theft

In an age where identity theft is a growing concern, safeguarding personal information is more critical than ever. One of the most effective tools in protecting taxpayers from tax-related identity theft is the IRS Identity Protection PIN (IP-PIN). This blog explores what an IP-PIN is, its role in securing taxpayer information, and how individuals can obtain and use it to prevent fraud.

What Is an IP-PIN?

An Identity Protection Personal Identification Number (IP-PIN) is a unique six-digit code issued by the Internal Revenue Service (IRS) to eligible taxpayers. This number acts as an additional security measure when filing federal tax returns, ensuring that only the rightful taxpayer can submit a return using their Social Security Number (SSN).

The IP-PIN serves as a critical layer of defense, preventing identity thieves from filing fraudulent tax returns under a taxpayer’s name. Without the correct IP-PIN, unauthorized individuals cannot submit a return using the taxpayer's SSN.

How an IP-PIN Helps Prevent Identity Theft

Tax-related identity theft occurs when a fraudster uses a stolen SSN to file a fraudulent tax return and claim an illegitimate refund. This can lead to severe financial and emotional distress for the victim.

To combat this issue, the IRS assigns an IP-PIN to confirmed victims of identity theft, protecting their future tax filings. Even if a fraudster obtains the taxpayer’s SSN, they cannot file a return without the corresponding IP-PIN. The IRS uses this number to verify the authenticity of tax filings, reducing fraudulent activity.

How the IP-PIN Works

The IP-PIN must be included on the taxpayer’s federal tax return each year. Here’s how it functions:

• The IP-PIN is entered in a designated field on the tax return.

• The IRS uses it to verify the taxpayer’s identity before processing the return.

• If a tax return is filed without the correct IP-PIN, the IRS will reject it, preventing fraudulent filings.

• The IRS never contacts taxpayers via phone, email, or text requesting their IP-PIN—any such request is a scam.

Each year, the IRS issues a new IP-PIN to ensure continued security. Taxpayers receive their new IP-PIN at the beginning of the calendar year, either by mail or through their IRS Online Account. Those participating in the IP-PIN program should never share their PIN with anyone except their trusted tax preparer.

Eligibility and How to Obtain an IP-PIN

Initially, the IP-PIN program was only available to confirmed victims of identity theft. However, in 2021, the IRS expanded the program, allowing all taxpayers to opt in voluntarily. This enables individuals to proactively protect their identities, even if they have never experienced identity theft.

Steps to Obtain an IP-PIN:

1. Online Application: Taxpayers can apply using the IRS Get an IP-PIN tool, where they must verify their identity.

2. By Mail: If online verification fails, taxpayers can apply using IRS Form 15227.

3. In-Person Verification: Those unable to verify their identity online can schedule an appointment at an IRS Taxpayer Assistance Center.

   
   

Benefits of Using an IP-PIN

1. Enhanced Security – The IP-PIN adds a crucial layer of protection against tax fraud.

2. Peace of Mind – Taxpayers can feel secure knowing their tax returns cannot be filed fraudulently.

3. Proactive Protection – Even if a taxpayer has not been a victim of identity theft, enrolling in the program helps prevent future fraud.

4. Annual Renewal – Each year, the IRS provides a new PIN to maintain security.

Challenges & Considerations

While the IP-PIN program is highly beneficial, taxpayers should be aware of the following challenges:

1. Identity Verification Process – Some taxpayers may find it difficult to verify their identity due to lack of necessary documents or limited internet access.

2. Annual Renewal – Taxpayers must obtain a new IP-PIN each year to continue protection.

3. Limited Availability – The Get an IP-PIN tool is unavailable from mid-November through mid-January.

4. Taxpayer Responsibility – Keeping the IP-PIN secure is crucial, as an incorrect or missing PIN can lead to a rejected tax return.

Protect Your Identity With an IP-PIN

The IRS Identity Protection PIN (IP-PIN) is an essential tool in the fight against tax-related identity theft. By providing an additional security layer, it ensures that only legitimate taxpayers can file tax returns under their SSN. With the option for all taxpayers to opt in, individuals can proactively safeguard their identities and minimize the risk of fraud.

As identity theft remains a significant threat, enrolling in the IP-PIN program is a smart step toward securing your financial future. If you have questions about obtaining an IP-PIN or need assistance with your tax filings, contact our office today.