IRS will mask business tax transcript identifying information
The IRS announced on Friday that it is taking a step to fight identity theft for business taxpayers by masking sensitive identifying data on business tax transcripts (IR-2020-254). The rules will apply beginning Dec. 13, and the IRS is asking for suggestions on changes to the rules before that date.
Tax preparation professionals often use tax transcripts to prepare current-year returns or represent taxpayers before the IRS. Lenders also use transcripts to verify income.
The IRS explained that this is what would be visible on the new business tax transcripts:
Business tax transcripts also have space for a customer file number, an optional 10-digit number that can be created by third parties (e.g., lenders) to allow them to match a transcript to a taxpayer. The customer file number field will appear on the transcript when that number is entered on Line 5 of Form 4506-T, Request for Transcript of Tax Return, and Form 4506T-EZ, Short Form Request for Individual Tax Return Transcripts. The customer file number may be any number except the taxpayer’s Social Security number or employer identification number.
— Sally P. Schreiber, J.D., (Sally.Schreiber@aicpa-cima.com) is a JofA senior editor.
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