IRS Requesting Additional Information from Title/Escrow Companies During Calls on Behalf of Taxpayer
Wednesday, February 28, 2018
February 28, 2018
The IRS has a new verification program that goes beyond the previous requests for name and company TIN. Now, a third party calling on behalf of a taxpayer will need to have more information on hand. Accordingly, authentication now requires anyone calling the IRS to provide their name, the company’s taxpayer ID (TIN) and their centralized authorization file (CAF) number.
This revised policy is part of the IRS's “Third Party Authentication” portion of the IRS Manual. (IRM 126.96.36.199) The new information requirement is an attempt by the IRS to fight fraud and protect taxpayer privacy. The change was made with little fanfare in early January and has caught many third parties off-guard. The CLTA understands that some title companies have made some internal procedural changes in order to adjust to the new requirements.
Although the IRS may make more changes in the future, the title industry is working towards making sure that the IRS considers the impact on real estate settlement service providers in addition to tax professionals representing taxpayers.