C-Suite Advisory

Creating an IRS account and Obtaining an Identity Protection PIN (IP PIN)

IRS account

No matter your roll in an organization your identity should always be protected, especially at the Tax Level. An Identity Protection PIN (IP PIN) is a six-digit number that prevents someone else from filing a tax return using your Social Security number. Think of it as a unique extension to your Social Security number that only you and the IRS have access to. It’s mailed directly to your home or accessed through the online IRS platform which requires dual notification to access.

The IRS has been doing this for a number of years although recently it has been easy to obtain. Historically speaking the idea of obtaining an IP PIN was to add an extra layer of security to you in the event of identity theft and that was the only way it was issued although in 2021 it became available to all.

With access to our personal data becoming more and more readily available as we transition digitally anything we can do to protect our tax status and credit status is imperative. Having an IP PIN also speeds up the processing of your income tax return and with faster processing allows for faster refunds.

With the ease of online filing tax fraud and false refund claims has increased dramatically and for clients who make estimated tax payments or obtain large refunds this could mean waiting extra months or years for the IRS to complete the claim

Additionally having access to your IRS account will be able to timely see notices and see filed returns and transcripts on your account filed with your SSN. Even if someone steals your IRS password they text each time you try to log in. You will also be able to see your balances and filings in real time and track processing.

This does add an extra form to keep track of during filing season. In the event you lose your IP PIN or are unable to access it you would have to call the IRS directly or snail mail your income tax returns significantly slowing down the filing process so be sure to store the annual PIN in a safe spot and only share with the tax preparer.

I also suggest when sharing confidential tax data always request the use of secure portals and other secure document transfer portals.

FAQS:

An Identity Protection PIN (IP PIN) is a six-digit number that prevents someone else from filing a tax return using your Social Security number. IP PIN added an extra layer of security to you in the event of identity theft. In 2021 it became available to all.

Although more recently we have been advising client to obtain these PIN numbers as an extra security feature especially for clients who make estimated tax payments or obtain large refunds. You can apply IP PIN for yourself, your spouse and your dependents.

If you made an estimated tax payments and someone falsely files your return before you can they can claim that refund and take you months if not years to recover the error. You can use your IP PIN for filing forms 1040, 1040PR and 1040SS.

You can also have access to your IRS account, which enables you to timely see notices and see filed returns and transcripts on your account to see all documents filed with your SSN. Even if someone steals your IRS password then they text you each time that you try to log in.

How can you apply for IP PIN?

Online Website to apply: Get An Identity Protection PIN (IP PIN) and get access of get an IP PIN tool.

Alternatively, you can also apply offline by filing form 15227 or Requesting in-person authentication (For in-person meeting you will need your Govt. Issued ID for verification and you can find local Taxpayer Assistance Center by entering your 5-digit zip code in “Find a Taxpayer Assistance Center Office”). For applying offline, you must have SSN, your last filed year AGI must below $73,000 for Individuals or $146,000 for Married Filing Joint and access of your telephone as IRS will call you and verify your Identity.

After verifying your identity IRS will provide you your IP PIN via U.S Postal service & then you will receive your IP PIN annually through the Email in “Notice: CP01A” in each December/January.

Important things to remember about your IP PIN:

Do not reveal your IP PIN to anyone other than your tax preparer. Must use your IP PIN on your current or prior years Forms 1040, 1040-SR, 1040-NR or 1040 PR/SS returns you file in the calendar year or IRS will reject electronically filed returns. Your IP PIN is valid only for federal income tax returns as PINs for Federal and State are different.

How to get your IP PIN reissued?

If you’re unable to retrieve your IP PIN online, you may call IRS at 800-908-4490 for specialized assistance, Monday – Friday, 7 a.m. – 7 p.m. your local time (Alaska & Hawaii follow Pacific Time), to have your IP PIN reissued. An assistor will verify your identity and mail your IP PIN to your address of record within 21 days.

Obstacles if you request a PIN and cannot access it:

If you don’t specify the IP PIN or incorrect specification of IP PIN in your online tax return, results rejection your electronically filed returns by IRS.


Written by James P. Giacopelli.
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James Giacopelli
James P. Giacopelli is a Partner at Giacopelli Accounting and Tax Service, LLC. James is experienced in handling all manners of accounting and is familiar with Federal and State Accounting and Tax Laws. James serves on several private and non profit Company Boards. James graduated Summa Cum Laude with his MBA from West Virginia University. James Giacopelli is an opinion columnist for the CEOWORLD magazine. Follow him on LinkedIn.