The IRS announced last week that the value of identity theft protection services are not taxable and do not have to be included in gross income calculations for tax purposes.

Identity theft continues to be the number one consumer complaint to the Federal Trade Commission each year, and with the increases in data breaches, this complaint will not dissipate. It is common for companies who suffer a data breach to offer credit monitoring or fraud resolution services to mitigate the potential for individuals to become victims of identity theft.

This ruling is consumer friendly and gives guidance to millions of Americans (and their tax planners) who have been offered these services in the wake of massive data breaches.