IRS to Change Tax Transcript Format to Protect Taxpayer Information

By Kendra JollyIn an attempt to better protect individual taxpayers, the IRS is implementing a new format for individual tax return transcripts. As of September 23, 2018, the IRS has released the new and improved 4506-T/T-EZ, Request for Transcript of Tax Return. The form serves higher protection against identity theft and fraudulent tax returns by redacting personally identifiable information on the transcript such as name, name of business, Social Security Numbers, Employer Identification Numbers, account numbers, addresses, and phone numbers. The transcript will now only show the following items:1. Last 4 digits of any SSN, EIN, Bank Account, or phone number2. First 4 characters of individual’s last name or business name3. First 6 characters of the street address, including spaces4. All money amounts, including balance due, interest paid and penaltiesThrough this specific update to the form, only the individual taxpayer will be able to formally decipher the information.Third parties, such as tax professionals and bank lenders who need access to transcripts, will be able utilize the new “Customer File Number.” The taxpayer can assign an optional 10-digit number via Form 4506-T, Line 5b. The Customer File Number can be any variation except the taxpayer’s SSN and will populate on the transcript so that third parties are able to access and match the information to the taxpayer. Click here to review a sample of the latest transcript implementing all new changes.