(833) 452-0411
(833) 452-0411

Blog

Get a Free Consultation

Welcome to our Blog

Stay up to date with the latest in the tax world!

IRS to mask key business transcript details; protect taxpayers from identity theft

Friday, November 13, 2020

 

WASHINGTON – Moving to protect business taxpayers from identity theft, the Internal Revenue Service today announced that starting Dec. 13 it will begin masking sensitive data on business tax transcripts.

The announcement provides 30 days for stakeholders to make any adjustments. The IRS began informing tax professionals of this change during the summer Nationwide Tax Forums. The agencypreviously masked sensitive data on individual tax transcripts two years ago.

A tax transcript is a summary of a tax return. Transcripts are often used by tax professionals to prepare prior year tax returns or represent the client before the IRS. Lenders and others use tax transcripts for income verification purposes.

Here’s what is visible on the new tax transcript:

  • Last four digits of any Employer Identification Number listed on the transcript: XX-XXX1234
  • Last four digits of any Social Security number or Individual Tax Identification Number listed on the transcript: XXX-XX-1234
  • Last four digits of any account or telephone number
  • First four characters of the first, and last name for any individual (first three characters if the name has only four letters)
  • First four characters of any name on the business name line
  • First six characters of the street address, including spaces
  • All money amounts, including wage and income, balance due, interest and penalties

For both the individual and business tax transcript, there is space for a Customer File Number. The Customer File Number is an optional 10-digit number that can be created usually by third parties that 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.

Here’s how it would work for a taxpayer seeking to verify income for a lender:

  1. The lender will assign a 10-digit number, for example, a loan number, to the Form 4506-T. The Form 4506-T may be signed and submitted by the taxpayer or signed by the taxpayer and submitted by the lender.
  2. The Customer File Number assigned by the requestor on the Form 4506-T will populate on the transcript. The requestor may assign any number except the taxpayer’s Social Security number or Employer Identification Number.
  3. Once received by the requester, the transcript’s Customer File Number serves as the tracking number to match it to the taxpayer.

More information about the masking of transcripts can be found at IRS.gov’s e-Services page after Dec. 13.

 

Back to Blog Home
Categories
Recent Posts
Archive
Tags

Advocates of Love Charity

When you signup with Alliance Tax Solutions, a portion of our proceeds go to support this amazing organization

Advocates of Love is the only children’s home to help orphan and vulnerable children in the Samana Province, Dominican Republic. Founded by Mike Clark in 2013, this charity has provided care and eduction for children in one of the most povery stricken areas.

Click Here To Learn More

Have Questions? Let Us Know!

Contact Us Today!

 

Connect With Us!
Privacy Policy | Terms
5665 New Northside Dr. Suite #540 , Atlanta, GA 30328

CALL TODAY (833) 452-0411 FOR TAX HELP, OR LET US CONTACT YOU

Error: Contact form not found.

“By entering your phone number and clicking the “Get Started” button, you provide your electronic signature and consent for Alliance Tax Solutions or its service providers to contact you with information and offers at the phone number provided using an automated system, pre-recorded messages, and/or text messages. Consent is not required as a condition of purchase. Message and data rates may apply.”

Contact Us Now