In March the IRS shut down the online system to retrieve an IP PIN, a development we noted at that time (see this article).  The IRS has now opened the site back up with what the agency claims are more stringent authentication requirements for taxpayers that should make it more difficult to fraudulently obtain such IP PINs.

The system is using the same more stringent authentication requirements that it required when it reopened the program to get a transcript online, a development we discussed in this article.

The notice describes what taxpayers who are trying to retrieve an IP PIN online will now need to possess:

Taxpayers must verify their identities using a more rigorous Secure Access process that requires them to have immediate access to an email address, account information from a credit card or other loans types and a text-enabled mobile phone. New and returning users must follow the Secure Access steps outlined in Fact Sheet 2016-20, How to Register for Get Transcript Online Using New Authentication Process.

Note that the mobile phone in question, under the transcript program, was required to be a phone on a post-paid plan, and not a prepaid phone plan. The latter type of plan is the only one generally offered by entities that resell access to cellular towers (“mobile virtual network operators”), including such entities that are controlled by larger post-paid services. Prepaid operators generally do not run credit checks on their customers and the IRS appears to have determined that it would be possible for those perpetrating the frauds to obtain phones in the names of the intended victims.

The downside, of course, is that identity theft victims that are using MVNO services (such as Google’s Project Fi or Cricket) will not be able to use the IP PIN online retrieval system. As well, it is reasonable to expect that many taxpayers will be unable to provide the information requested to prove their identity. Thus advisers should remind clients who receive an IP PIN or who are likely to receive them (having been tax ID theft victims) that they need to be sure to retain the IP PIN mailed to them, as if they lose it the processing of their next tax return may be delayed significantly.