Even the IRS Isn’t Immune to Data Breaches

Who has more of your personal information than anyone else? The government.

Whether it’s federal, state, or local government, they have a ton of information on each and every one of us. Not only do they issue your identification documents (birth certificate, Social Security card, driver’s license, passport), but every year you have to send them all your personal information when you pay taxes. Just think about everything the IRS knows about you…

So when the IRS gets breached, it’s okay to feel scared.

This week the IRS is sending letters to 220,000 US citizens to say, we messed up and your information may be in the hands of identity thieve. Terribly sorry. Hope you don’t have any hard feelings. Talk to you next year when you have to send us all your private information again.

When Target and the Home Depot got breached, many people spoke out and said they were not going to shop with those retailers again. While I doubt many actually went through with that threat (Live without Target? Probably not!), at least they had the option to avoid those stores if they wanted to. You can’t avoid the IRS. (You can try, but they’ll come after you.)

The IRS is giving these people free credit monitoring and a special IP Pin to make filing next year’s taxes more secure. But let’s face it, that isn’t going to fix the problem. Credit monitoring offers limited protection and doesn’t always let you know about fraud in time to stop it. And what good does a more secure experience next year do when their information is already out there?

Clearly the IRS needs to rethink its security measures, and not just for people whose information they’ve already lost. They need to provide a more secure system for all tax payers.

For the rest of us, this is yet another cautionary tale of the need to increase our diligence and actively monitor our accounts for potential fraud. Don’t wait for your letter from the IRS…or Target…or the Home Depot…or whatever organization gets breached next.

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