After a great deal of pushback, the Internal Revenue Service finally concluded that basically, it’s OK, the IRS doesn’t need to see your selfie to verify that you are you.
Monday, the IRS announced plans to drop a controversial step to use facial recognition to verify IDs online.
The IRS said that it will move away from using a third-party service that used facial recognition to help authenticate people who needed to create new online IRS accounts to gain access to such things as the IRS Child Tax Credit Update Portal and obtain a tax transcript online.
Not surprisingly, taxpayers and those concerned about privacy never embraced the idea of sending a picture to to the IRS to open an online IRS account. And many expressed concerns that the technology may be less reliable for people of color or older people.
Many found the request, well, more than a bit unnerving.
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The uproar involved ID.me accounts at IRS.gov — not electronically filing a tax return.
The theory is that facial recognition could offer better security to crack down on ID theft. Crooks set up fake accounts to collect tax refunds — and not surprisingly try to cash in on big stimulus programs, such as the Recovery Rebate Credit or payments like the child tax credit.
Most people, of course, don’t want crime rings to use their ID to file a fake tax return or steal their refund money.
But we’re talking about a third party organization, not the federal government, processing the facial recognition data.
Mark Luscombe, principal analyst for Wolters Kluwer Tax & Accounting, said many were concerned about privacy issues when they realized a commercial third-party organization would be possessing a huge database of pictures of taxpayers — pictures that taxpayers would be required to submit to access their online taxpayer information.
Luscombe noted that the IRS just started asking taxpayers to use facial recognition software, through a third party called ID.me, last year to help identify people who wanted to opt out of the child tax credit advance payments.
“ID.me says that they simply compare a picture of a taxpayer photo ID to a selfie submitted by the taxpayer and use proprietary software to determine if the two match,” Luscombe said.
The IRS had planned to expand the required use of ID.me to taxpayers wanting to access their tax information online in June.
U.S. Sen. Ron Wyden, chairman of the Senate Finance Committee and an Oregon Democrat, had tweeted on Jan. 20 that he was “very disturbed that Americans may have to submit to a facial recognition system.”
Wyden called on the IRS to stop the practice. “The IRS does not use facial recognition for tax filing or to receive a refund, and the agency should not require facial recognition for any of the other important services it provides taxpayers,” Wyden wrote in a letter to the IRS commissioner.
“I have long argued that Americans should not have to sacrifice their privacy for security,” he said.
U.S. Rep. Bill Huizenga, R-Mich., authored a bill in early February to ban the IRS from using facial recognition software on taxpayers.
“It shouldn’t be legal,” Huizenga told Fox Business in an interview announcing the bill.
“Every page we turned on it, it was like red flag going up after red flag,” Huizenga said of the facial ID plans.
“I just don’t trust them with this information in that one, I don’t think they’re going to be able to keep it secure and two, I don’t trust them with what they will then do with the information.”
He raised concerns about the sensitive data being vulnerable to hackers. And he said he did not trust how the IRS would use the facial identification after the agency targeted conservative groups during the 2012 election to see whether they were violating tax-exempt status, according to the Fox report.
Matthew Cordes, an enrolled agent in Garrett, Indiana, said he first came across the issue when the IRS announced its portal for the advanced child tax credit payments last year.
“The taxpayer needed a photo of the front and back of a driver’s license or state ID, or a passport and then use a smartphone or webcam to scan their face,” he said.
“The system used facial recognition software to ‘match’ the face with the photo ID,” Cordes said.
Cordes saw some possible problems for how some groups of people could even set up these accounts.
“It can be technologically prohibitive to the elderly and the poor who might not have access to smartphones or computers,” Cordes said.
“I ran into one such individual today who could not create an online account because she does not have a working telephone number,” he said.
The woman uses Wi-Fi calling on a Wi-Fi-enabled device with subsidized internet, he said.
Ahmer Inam, chief data and AI officer of Relanto.ai, said in an email that there are numerous concerns with the IRS using facial recognition in this way.
“For one, historically, facial recognition AI technologies have been found to have a racial bias issue,” he said.
“It’s so prevalent, in fact, some state and local governments are legislating bans on employing this technology. The problem stems from the original data that is used to ‘train’ the facial recognition models.”
As a result, Inam said there is a high risk of mistakes with identification, especially of Asians and African Americans who aren’t always adequately represented in the training models.
The IRS began the process in November
The IRS first announced in November that it was unveiling a new online identity verification process to gain access to self-help tools online.
To verify their identity with ID.me, the taxpayer, the IRS said, would need to provide a photo of “an identity document such as a driver’s license, state ID or passport.”
And the IRS continued: “They’ll also need to take a selfie with a smartphone or a computer with a webcam. Once their identity has been verified, they can securely access IRS online services.”
The new “mobile-friendly verification procedure” is used to gain entry to existing IRS online services such as the “Child Tax Credit Update Portal,” the IRS online account, the “Get Transcript” online service and even for getting an identity protection PIN, as well as an online payment agreement.
The IRS said the change announced Monday does not interfere with the taxpayer’s ability to file their return or pay taxes owed.
“The transition will occur over the coming weeks in order to prevent larger disruptions to taxpayers during filing season,” the IRS said in its release.
The IRS is dropping the facial recognition idea and said it would “quickly develop and bring online an additional authentication process that does not involve facial recognition.”
Many tax professionals and others thought the IRS was making a smart move by just dropping a bad idea.
“I, personally, believe that they took it too far with facial recognition. The dual verification is sufficient security. They don’t require facial recognition to call the IRS and speak with an agent,” said Antonio Brown, a CPA in Flint.
Brown said taxpayers can file a 2021 tax return without setting up facial recognition and they don’t have to worry about the change.
But the IRS allows taxpayers to set up an online account to review tax documents reported to the IRS — documents like account transcripts, tax liability balances in the case the taxpayer owes the IRS, he said.
And that’s where the facial recognition feature was involved.
As an added security measure for these online accounts, Brown noted, the IRS moved away from its existing account to this new third-party entity to increase its online security.
“As the IRS transitioned to this new site, they were phasing out the old site, so your old account would no longer be active and taxpayers would be directed to the new site to create a brand new account,” Brown said.
“This new site requests facial recognition as means of verifying the identity of the taxpayer looking up their private IRS records.”
The IRS said it will continue to work with its cross-government partners to develop authentication methods that protect taxpayer data and ensure broad access to online tools.
“The IRS takes taxpayer privacy and security seriously, and we understand the concerns that have been raised,” IRS Commissioner Chuck Rettig said in a statement.
“Everyone should feel comfortable with how their personal information is secured, and we are quickly pursuing short-term options that do not involve facial recognition.”
During this period, the IRS will continue to accept tax filings.
“People should continue to file their taxes as they normally would,” according to an IRS statement.