IRS 2015 Data Breach Seven Times Larger than Originally Thought

In May 2015, the U.S. Internal Revenue Service (IRS) disclosed that income tax forms of 104,000 people had been breached through a tool on that agency’s website. An updated report on February 26, 2016 reveals the actual total to be about 720,000 people affected.

Although this isn’t positive news, the number isn’t as high as it could have been. The IRS disclosed that thieves had tried to access an additional 295,000 personal tax forms, but those attempts were unsuccessful.

An interim report in August 2015 from the tax agency that requires accuracy from those filing their income tax forms each year revealed the number of breached people’s forms to be 330,000. The February 26 report more than doubles that number and came about as the result of an investigation by the U.S. Treasury Inspector General for Tax Administration. IRS Commissioner John Koskinen said in a statement, “We appreciate the work of the Treasury Inspector General for Tax Administration to identify these additional taxpayers whose accounts may have been accessed. We are moving quickly to help these taxpayers.” (CNN.com)

Beginning the first week of March 2016, the IRS will begin sending letters to those taxpayers whose records may have been breached to alert them to that potential, to provide a personalized identification number (PIN) to protect future tax information and offer free credit protection.

How Did the IRS Breach of Information Occur?

The breach occurred when what the agency termed a “sophisticated” organized crime syndicate used the IRS website tool, “Get Transcript,” a tool designed to make it simple for taxpayers to download several years of tax forms if needed to get a mortgage or other similar uses. “Get Transcript” was temporarily disabled by the IRS once the breach was discovered. (CNN.com)

The disclosure of people’s tax information was not a typical cyber hacking where computer-savvy thieves break through encryption to obtain information. Instead, what has been called a “cybermafia” posed as taxpayers to access forms via “Get Transcript” by using stolen data including Social Security numbers, but also answers to personally-identifying information – such as what might be obtained through stolen medical records. (CNN.com)

Related Article: Health Care Record Hacking Soars in United States

The information thieves used the illegally obtained tax and personal information to file false claims for 15,000 income tax refunds, but just as importantly, the information breach allowed the “cybermafia” to add even more personal and financial information on each person than they already had, likely all obtained surreptitiously.


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