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IRS Prodded to Allow Taxpayers to Verify Their Tax Information and Identity Online

The IRS needs to improve its procedures to enable taxpayers to access their tax account information and identities online in a secure way, according to a new report from the Treasury Inspector General for Tax Administration (TIGTA).

J. Russell GeorgeThe IRS Restructuring and Reform Act of 1998 requires the IRS to develop procedures to allow taxpayers filing returns electronically to review their accounts online. However, after 32 months of development and approximately $10 million in expenditures, the project was canceled due to an ineffective enterprise-wide eAuthentication solution.

It was found that none of the current applications that the IRS has developed and implemented so far have met the intent of the 1998 law.

The IRS is planning to deploy a Get Transcript application in January 2014 that promises to enable taxpayers to access their tax account to obtain transcript information via the Internet.

The IRS has struggled to control the growing epidemic of tax-related identity theft, so secure access to its online systems and identity validation have become top priorities in recent years.

The report made four recommendations to the IRS, and the IRS agreed with three of them. The IRS plans to prioritize release of applications that meet the requirements of the 1998 law, complete performance and capacity testing as part of Release 2 of the eAuthentication application, and to increase the reporting functionality in Release 2.

Original story on Accounting Today.