IP PINs to be available to all individuals in 2021

Starting in January, the IRS will allow all individuals to receive an identity protection personal identification number (IP PIN). The IRS announced (IR-2020-267) on Wednesday that it will unveil a portal in mid-January 2021, expanding to all individual taxpayers the opt-in program to voluntarily receive an IP PIN. The expanded initiative is part of the Security Summit effort between the IRS, state tax agencies, and the tax preparation industry. IP PINs were originally available only to identity theft victims, and the IRS has been running a limited pilot program, allowing other taxpayers to voluntarily receive IP PINs.

An IP PIN is a six-digit number designed to prevent the misuse of Social Security numbers to submit fraudulent federal income tax returns. It helps the IRS verify taxpayers’ identity and accept their electronic or paper tax return. The online Get an IP PIN tool immediately displays a taxpayer’s IP PIN; however, the tool is currently down while the IRS prepares for the 2021 tax filing season.

To obtain an IP PIN, beginning in mid-January 2021, taxpayers can go to the tool, which the IRS says is the preferred method, as it is the only one that immediately reveals the PIN to the taxpayer. The online tool employs Secure Access authentication, which uses several methods to verify a person’s identity.

The IP PIN is valid for one year. The taxpayer must obtain a newly generated IP PIN every January.

Taxpayers with either a Social Security number or an individual tax identification number who can verify their identity are eligible for the opt-in program. Any primary taxpayer (first on the tax return), secondary taxpayer (second on the tax return), or dependent may obtain an IP PIN if he or she can pass the identity proof requirements.

The IRS says it plans to offer an opt-out feature to the IP PIN program in 2022 for taxpayers who find the opt-in program is not right for them.

There is no change to the IP PIN program for victims of identity theft. Taxpayers who want to voluntarily opt into the IP PIN program do not need to file a Form 14039, Identity Theft Affidavit.

Alternative process

Taxpayers who cannot establish their identity online and pass Secure Access authentication can follow alternative procedures to obtain an IP PIN, though they will not receive one immediately.

Taxpayers with income of $72,000 or less with access to a telephone should complete Form 15227, Application for an Identity Protection Personal Identification Number, and mail or fax it to the IRS. The IRS will call taxpayers to verify their identity by asking a series of questions. For security reasons, taxpayers who pass authentication through this process will receive an IP PIN the following tax year.

Taxpayers who cannot verify their identity remotely or who are ineligible to file a Form 15227 may make an appointment to visit a Taxpayer Assistance Center, bringing two forms of picture identification to enable an in-person identity verification. An IP PIN will be mailed to the taxpayer within three weeks of the meeting.

The IRS emphasized that taxpayers who obtain an IP PIN should never share it with anyone except their tax preparer. The IRS will never call a taxpayer to request an IP PIN, and taxpayers should be alert to IP PIN scams, as the ingenuity of criminals appears boundless.

— Sally P. Schreiber, J.D., (Sally.Schreiber@aicpa-cima.com) is a Tax Adviser senior editor.