IRS Expands Scope of Tax Relief for Identity Protection Services
07.13.2016 | eVisor
Recognizing the increasing threat of identity fraud today, the IRS has expanded the scope of its tax treatment of identity protection services provided to employees to coverage before a data breach occurs.
Back in 2015, the IRS issued Announcement 2015-22 stating that it “will not assert that an individual whose personal information may have been compromised in a data breach must include in gross income the value of the identity protection services provided by the organization that experienced the data breach.” Employers were not required to report the value of the identity protection services provided on information returns such as W-2s and 1099s.
In response to a wave of comments from employers and industry professionals, both the Treasury Department and the IRS agreed that 2015-22 should be extended to include identity protection services provided to employees (and other individuals) before they experience a data breach.
Questions? Contact your Berdon advisor
Berdon LLP, New York Accountants.