The company worked with Palo Alto security startup Palantir to develop security procedures to block such filings. Intuit was forced to shut down TurboTax service for almost 24 hours in February - just a day after the Anthem hack was originally reported - when states complained to the company about a large number of fraudulent returns. You squeeze harder on one end, and the problems get bigger at the other end.” “Tax fraud is migrating to state returns,” Breyault said. With so may Americans e-filing, federal tax authorities have identity theft on their radar screens in a big way, Breyault said, but tax scam crooks have begun to prospect in promising new territory. The IRS said that 86 percent of federal tax returns were filed electronically last year, after steady gains in the past decade: 2005 was the first year the majority of returns were filed online, at 51.1 percent. Potential security issues aren’t stopping most Americans from filing their taxes electronically, though. “That breach provided sufficient info that anyone could file a tax return for any individual whose data was compromised.” “Maybe the worst incident was the huge Anthem data breach,” said Paul Stephens, director of policy and advocacy with the San Diego-based Privacy Rights Clearinghouse, a nonprofit group. That represented a 49 percent increase in data breaches and a 78 percent increase in the number of records that were lost or stolen worldwide, Gemalto reported in its Breach Level Index for 2014. In 2014, more than 1,500 data breaches led to 1 billion records being compromised worldwide, according to a recent report by Netherlands-based Gemalto, a data security firm. “We are very concerned about the connection between identify theft and tax fraud. “Going back to at least 2012, tax refund fraud is the biggest category of identify fraud reported to the Federal Trade Commission,” said John Breyault, a vice president with the National Consumers League. Frequently, the first time that a taxpayer becomes aware that their data has been compromised is after they file their return, are waiting for a refund, and receive a notice from the IRS that somebody has already filed their tax return. Scammers are using Social Security numbers and other information collected in data breaches to steal a person’s identity and file for their tax return.
That has implications for people who use TurboTax online or any online tax preparation.” “We are seeing tax refund fraud being driven by identify theft.
Turbotax 2015 free state hack software#
“Tax fraud this year is very prevalent, primarily because of these recent high-profile data breaches,” said Julie Miller, a spokeswoman for Intuit, a Mountain View software maker whose signature products include the TurboTax program. By its very nature, tax season unleashes a certain amount of angst, but this year may produce a higher level of foreboding due to a slew of data breaches that have imperiled electronic filing of tax returns.