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IRS, Partners Urge Strong Passwords Help Protect Identities at Tax Time and Beyond

The Internal Revenue Services and its partners, in the fight against identity theft, urge computer users to strengthen their passwords. The password serves as the first line of defense to stop hackers and identity thieves from accessing your computer, mobile phone and other internet-accessible devices. The IRS, state tax agencies and the tax professional industry are asking for your help in their effort to combat identity theft and fraudulent tax returns. Working in partnership with you, we can make a difference. That’s why we launched a public awareness campaign that we call Taxes. Security. Together. We’ve also launched a series of security awareness tips that can help protect you from cybercriminals.

Here are a few basic steps to making passwords better and stronger:

1. Add password protections to all devices. You should use a password to protect any device that gives you that opportunity. Not only your computer, tablet or mobile phone but also your wireless network. The password is your first line of defense.

2. Change all factory password settings. If your device comes with factory password settings, for example the camera on your laptop, change it immediately. 

3. Longer is better. A password should be a minimum of eight digits but 10 to 12 is even better. It should be a combination of upper case and lower case letters, numbers and special characters. Do not use your name or birthdate.

4. Do not repeat passwords. These days, people often have multiple, password-protected accounts. Do not use the same password repeatedly. Should a thief steal your password, he immediately will have access to other important accounts. Use different passwords, especially on important financial or tax accounts. 

5. Use two-factor authentication options. Many social media and financial institutions now give you the option of setting up a two-factor or two-step authentication process. A two-factor process involves a security code being sent to your registered mobile phone. This means if a thief manages to steal your user name and password, he will be blocked from accessing your accounts.

6. Consider a password manager. One option for keeping track of your passwords on multiple accounts and getting help in creating strong passwords is to use a password manager. Some reputable companies offer free or low-cost versions of their products. See if a password manager might be right for you.

The IRS, state tax agencies and the tax industry joined as the Security Summit to enact a series of initiative to help protect you from tax-related identity theft in 2017. You can help by taking these basic steps. To learn additional steps you can take to protect your personal and financial data, visit Taxes. Security. Together. Also read Publication 4524, Security Awareness for Taxpayers.

Share this tip on social media -- #IRStaxtip: #IRS, Partners Urge Strong Passwords Help Protect Identities at Tax Time and Beyond. http://go.usa.gov/x8Pkj #IRS

Are Social Security Benefits Taxable?

If taxpayers receive Social Security benefits, they may have to pay federal income tax on part of those benefits. These IRS tips will help taxpayers determine if they need to do so.

  • Form SSA-1099.  If taxpayers received Social Security benefits in 2016, they should receive a Form SSA-1099, Social Security Benefit Statement, showing the amount of their benefits.
  • Only Social Security.  If Social Security was a taxpayer’s only income in 2016, their benefits may not be taxable. They also may not need to file a federal income tax return. If they get income from other sources, they may have to pay taxes on some of their benefits.
  • Free File.  Taxpayers may use IRS Free File to prepare and e-file their tax returns for free. If they earned $64,000 or less, they can use brand-name software. The software does the math for them, which helps avoid mistakes. If taxpayers earned more, they can use Free File Fillable Forms. This option uses electronic versions of IRS paper forms. It’s best for people who are used to doing their own taxes. Free File is available only by going to IRS.gov/freefile.
  • Interactive Tax Tools.  Taxpayers can get answers to their tax questions with this helpful tool, Are My Social Security or Railroad Retirement Tier I Benefits Taxable, to see if any of their benefits are taxable. They can also visit IRS.gov and use the Interactive Tax Assistant tool.
  • Tax Formula.  Here’s a quick way to find out if a taxpayer must pay taxes on their Social Security benefits: Add one-half of the Social Security income to all other income, including tax-exempt interest. Then compare that amount to the base amount for their filing status. If the total is more than the base amount, some of their benefits may be taxable.
  • Base Amounts. The three base amounts are:
    • $25,000 – if taxpayersare single, head of household, qualifying widow or widower with a dependent child or married filing separately and lived apart from their spouse for all of 2016
    • $32,000 – if they are married filing jointly
    • $0 – if they are married filing separately and lived with their spouse at any time during the year
Lora Epperson