IRS Student Loan Data Breach Compromises up to 100,000 Taxpayers

    Apr 25, 2017

    This month the IRS said the personal data of up to 100,000 U.S. taxpayers could have been compromised through a scheme whereby hackers posed as students using an online tool to apply for financial aid, according to an article in the New York Times.

    The attack became known in March when the IRS closed its Data Retrieval Tool, which families use to import tax information to the Free Application for Federal Student Aid site, on the Education Department’s website. The shutdown occurred at the height of financial aid application season.

    The IRS has been struggling to overhaul its defenses against increasingly sophisticated cyber threats as its budget shrinks and its staff dwindles.

    Last fall, the IRS realized criminals could exploit the student loan tool, which allows aid applications to automatically populate with their parents’ tax information. The fear was that thieves could use the stolen data to file fraudulent tax returns.

    “Fortunately we caught this at the front end,” said John Koskinen, the IRS commissioner, at a Senate Finance Committee hearing.

    The IRS does not expect the tool to be secure and operational again until October.


    © 2017, ARMA International