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IRS Introduces Post-Release Changes to Tax Forms to Protect Taxpayer Data

08/24/2018

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Taxpayers often must provide IRS tax forms to lenders, colleges and other third parties for non-tax purposes. 

To better protect taxpayer data, the IRS has announced a new format for online individual tax transcripts that will redact personally identifiable information from the Form 1040 series. The changes will begin on Sept. 23, 2018. 

The following information will be provided on the new transcript:

  • Last 4 digits of any SSN listed on the transcript: XXX-XX-1234
  • Last 4 digits of any EIN listed on the transcript: XX-XXX-1234
  • Last 4 digits of any account or telephone number
  • First 4 characters of the last name for any individual
  • First 4 characters of a business name
  • First 6 characters of the street address, including spaces
  • All money amounts, including balance due, interest and penalties

With the financial entries remaining visible, taxpayers and third parties will have the data they need for tax preparation or income verification. 

Taxpayers will be able to create a customer file number to use as an identifier instead of using a taxpayer’s Social Security number. The Customer File Number listed on the 4506-T will automatically be posted and visible on the tax transcript, allowing the third party to match the document to the taxpayer. 

For the full release, reference IR-2018-171.

Download the 2018-19 Tax Planning Guide

LBMC tax tips are provided as an informational and educational service for clients and friends of the firm. The communication is high-level and should not be considered as legal or tax advice to take any specific action. Individuals should consult with their personal tax or legal advisors before making any tax or legal-related decisions. In addition, the information and data presented are based on sources believed to be reliable, but we do not guarantee their accuracy or completeness. The information is current as of the date indicated and is subject to change without notice.