The official word is that identify theft baffles the IRS. That’s very concerning, because if the IRS is baffled, then it means it has no definite means of stopping or preventing it. The General Accountability Office (GAO) reports that the IRS Paid out 5.8 billion dollars in 2013 for bogus refunds filed in 2013. That really bad news is that is probably a low figure since it’s impossible to know the real amount.
Now, there is a cooperative effort that includes the IRS, and state tax administrators and other tax preparation entities that are working together to fight tax fraud. Steps taken include reviewing computer IP addresses of online tax returns to determine if duplicate forms are being filed. The time it takes to file a return will also be a consideration, since filing a fraudulent return takes less time to file than a real return.
Companies that create tax preparation software are also getting in the mix by using enhanced protocols that will help validate the true identity of the filer. There’s a lot of work for the IRS to get done. Victims must jump through numerous hoops before the IRS can complete its investigation and refund the victim for monies that were stolen. The speed of these IRS programs are notoriously slow and lacking.
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Law Offices of Darrin T. Mish, P.A.: Tax Attorney