For years, we have heard stories about how identity thieves hack into computers and steal personal information. We have been assaulted with phishing scams where thieves impersonate IRS employees and intimidate innocent taxpayers into paying large sums of money for taxes they don’t owe. No one is immune to this threat. Individuals in all 50 states have been targeted.
Now the thieves are targeting business owners. To put things into perspective, through June 1, 2017, the IRS identified approximately 10,000 business returns as potentially theft-related compared to about 4,000 for calendar year 2016 and 350 for calendar year 2015.
This coming filing season, the IRS will be asking tax professionals to gather more information on their business clients. All the data being collected assists the IRS in authenticating that the tax return being submitted is the legitimate return and not an identity theft return. Some of the new information people may be asked to provide when filing their business, trust or estate client returns include:
• The name and social security number of the individual authorized to sign the business return. Is the person signing the return authorized to do so?
• Were estimated tax payments made? If yes, when were they made, how were they made, and how much was paid?
• Is there a parent company? If yes, what is its name?
• Additional information based on deductions claimed.
• Has the business filed Form(s) 940, 941 or other business-related tax forms?
Now is a good time to determine if you need an employer identification number. If you are required to have one, the IRS will ask for it.