The tax software manufacturer, Tax Act, has just informed some of its customers that an unauthorized third party accessed their TaxAct account in late 2015.
In a letter sent to their customers January 11, 2016, TaxAct stated an unauthorized third party accessed TaxAct accounts between November 10 and December 4, 2015. TaxAct believes the third party obtained usernames and passwords from sources outside of their own system and have disabled those impacted customers’ accounts temporarily.
After working alongside the IRS, state regulators, and other tax software providers, TaxAct also found that customers’ tax return forms stored in their accounts may have been opened or printed. These documents contain confidential information such as customer name and social security number, and could possibly have customers’ addresses, driver’s license numbers, and even bank account information.
TaxAct has claimed that fighting tax-related identity theft is of top priority and that those affected by this breach will be provided with a year of free credit monitoring, a $1 million insurance reimbursement policy and will have access to ID protection experts to assist them during this difficult time.
In a statement to SC Magazine, Tax Act wrote, “We recently suspended a small number of accounts – less than .25 percent- after identifying instances of suspicious activity. As a result of our existing processes, we identified the issue early and prevented any further data from being compromised.”
The information obtained during this breach is more than enough to easily perpetrate identity theft, potentially causing years of disruption and inconvenience to those affected. As identity theft continues to cost consumers billions of dollars every year, it’s important that companies organizations handling personal information for customers need to assume that they will be subject to a cyber-attack and to plan accordingly.
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