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W-2 tax forms for 2016 can be bought and sold on the dark web at $20 or less

Why it matters to you

This is an example of how companies handling private and financial data need to crack down on internal security to keep hackers out.

Security researcher Brian Krebs reports that hackers are now selling W-2 tax forms on the dark web, a collection of websites that requires special software or authorization to access and can’t be found using Google or Bing. It’s an online world where pirated software can be obtained and cybercriminal shops can thrive, selling goods like PayPal account credentials, stolen credit cards, and now apparently last year’s tax forms.

According to Krebs, the W-2 tax form data was up for sale on an unnamed dark web shop under the “other” category. The data stemmed from more than 3,600 residents from Florida and included their employer’s name, employer ID, and employer address. The info also included the taxpayer’s personal information such as address, social security number, 2016 wage information, and the taxes withheld.

The stolen W-2 records required Bitcoins to purchase and their cost depended on the wage made by the taxpayer, ranging between $4 and $20 each. Thus, the higher the wage, the more money thieves could possibly land if they are successful in tricking the Internal Revenue Service with a fraudulent tax form filed using the purchased taxpayer information.

The tax information may have stemmed from a Florida-based firm called The Payroll Professionals. Krebs figured this out after a source purchased two of the listed W-2 forms stemming from Kirai Restaurant Group LLC. Krebs contacted the restaurant company who said it outsources employee tax forms to The Payroll Professionals.

A representative of The Payroll Professionals confirmed with Krebs that the company was aware of a “potential hacking” and was currently informing customers of the potential problem. Krebs found additional W-2 tax forms on the dark web storefront stemming from companies that use The Payroll Professionals to handle their payroll.

How The Payroll Professionals was hacked is unknown. In a typical scenario, scammers would spoof a bogus email to resemble a high-ranking official in a company and send it to human resources and the payroll department. The email would demand a copy of all employee W-2 data to be returned immediately.

Just days ago, a hacker impersonated Sunrun CEO Lynn Jurich in an email sent to the company’s payroll department and received employee W-2 forms for 2016. The hacker got away with “a substantial portion” of the company’s current and former employee personal and financial information. Luckily, Sunrun’s customer database was not affected by the phishing scam.

“Sunrun recognized the issue within one hour of the scam and immediately began working with the proper authorities,” the company said Friday. “We are committed to the safety and security of our employees’ information and will continue to work diligently to increase the security of our systems and implement tighter controls.”

Taxpayers worried about hackers filing fraudulent claims on behalf of their information can use file form 14039 (pdf) if they believe they are victims of identity theft. Taxpayers can also request a six-digit Identity Protection PIN to help combat fraudulent tax returns.