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ASK THE CALIFORNIA EMPLOYMENT TAX AND PAYROLL TAX ATTORNEY – TAX PROFESSIONALS SHOULD BE ON ALERT FOR SUBTLE SIGNS OF CYBERCRIMINAL ACTIVITY

By Robert S. Schriebman

2018

Introduction

Tax return preparers and tax advisors have been the beneficiaries of IRS press releases and seminars on cybercriminal activity that leads to the preparation of phony refund claims and the filing of fraudulent tax returns. We all know that client identity theft may not be a question of "if" but "when." The IRS has released IRS Tax Tip 2018-152 (October 1, 2018), warning of subtle signs that your computers have been invaded and your security has been breached.

This article will set forth warning signs that you are experiencing data theft.

IRS Tax Tip 2018-152

Here are a few of the warning signs of subtle cybercriminal activity listed in the Tax Tip:

  • Clients who have not filed tax returns receive refunds. Criminals are contacting these recipients posing as IRS employees and demanding that the refund be returned to the IRS through a transfer to the criminal's offshore accounts.
  • Your network computers are running slower than normal.
  • Cursers are moving or numbers are changing on the screen before your eyes with no one touching the keyboard.
  • Your properly e-filed returns begin to be rejected by the IRS because the return has already been filed with the same Social Security number.
  • Your clients and others are responding to emails that you did not send.
  • Network computers lock out your employees.

The IRS Tax Tip goes on to list eleven signs of cybercriminal activity. The IRS warns that these cybercriminals do not leave calling cards and you may not know that you have been invaded. The IRS goes onto warn of the many cases where preparers like you have fallen victim to these criminals.

The Tax Tip also references IRS Publications 4557 "Safeguarding Taxpayer Data," and Publication 5293 "Data Security Resource Guide for Tax Professionals."

Conclusion

These are dangerous times to be in the tax business. The IRS and its public partners cannot keep up with the barrage of cybercriminal activity. You must be alert on a daily basis - not just you, but your employees too. Subscribe to IRS Tax Tips and other free publications that will alert you and keep you safe. If your clients are safe, you are safe too.

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Robert Schriebman has a successful practice in the Rolling Hills Estates area of Los Angeles County serving clients throughout California and the United States. He has successfully dedicated more than 40 years to helping individual taxpayers, business owners, CPAs, Enrolled Agents, and tax attorneys navigate the complicated tax systems of the federal and state governments. Mr. Schriebman is in private practice. He is not affiliated in any way with the EDD and he is not employed by the EDD or any other agency of the State of California.

Robert Schriebman has written the only 2 books ever published dealing with how California Employment Development Department (EDD) operates. See "California Tax Collection Practice and Procedures" and "California Taxation Practice and Procedure," both published by Commerce Clearing House.

Robert Schriebman has written over 20 books including the major manual used nationally by practitioners and the IRS, "IRS Tax Collection Procedures - A Manual for Practitioners" published by Commerce Clearing House.

Robert Schriebman has written over 20 books including the major manual used nationally by practitioners and the IRS, "IRS Tax Collection Procedures - A Manual for Practitioners" published by Commerce Clearing House in addition to the only 2 books ever published dealing with how California Employment Development Department (EDD) operates. See "California Tax Collection Practice and Procedures" and "California Taxation Practice and Procedure," both published by Commerce Clearing House.

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Robert S. Schriebman, A Professional Law Corporation
734 Silver Spur Road, Suite 204
Rolling Hills Estates, CA 90274
Phone: 310-997-0342
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Fax: 310-541-4946
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