$4 Billion: Bogus Tax Refunds a Growing Problem

[Elrod]

A government report said the IRS issued $4 billion in fraudulent tax refunds over the previous year to criminals who were using other people's personal information.

http://www.usatoday.com/story/money/business/2014/04/10/bogus-tax-refunds-problem/7557897/

[kcjenkins]

And that's just the ones they caught.

[Jack from Ohio]

I expect that within 5 years there will be some sort of ID PIN provided by the IRS for each taxpayer OR-----

No refunds issued till W-2s and 1099s have all been processed. The era of fast tax refunds will be a thing of the past.

But on the other hand, what's a few Billion dollars amongst politicians and lawmakers anyway....

[David1980]

I would not be surprised if the number was actually lower. That there is $4 billion (and much more I'd expect) tax fraud payments is not a shock. What I think happens is some of the tax fraud people when caught go "Wasn't me!" and it gets labeled as identify theft, since it is so easy to point the finger at identity theft right now. Which is because identity theft is big. Systematically defrauding the US government is an offense that needs a greater punishment, whether that's filing fraudulent returns for willing taxpayers or filing identity theft returns. File 100 returns and claim an education credit on every one completely fraudulently you should be deported or jailed depending on citizenship. Make the penalty harsh. Go after the traitors. I guarantee you the numbers will fall.

I also would not be surprised if the number was actually higher. As kcjenkins said, that's only the ones that were caught. IRS seems to underestimate fraudulent pay outs because they can't be sure that it's all fraudulent so rather than estimate they give the lower number that they are sure on. Manipulating the numbers not unlike the financial manipulation that has been done by the big banks...

[Lee B]

All Congress has to do is change the law to allow the IRS to crossmatch the tax return info with the bank account info

and a big chunk of the fraud would go away. We have a bunch of leglislators who like to tell the voters about how they're

protecting them from the BAD IRS !

[David1980]

All Congress has to do is change the law to allow the IRS to crossmatch the tax return info with the bank account info

and a big chunk of the fraud would go away. We have a bunch of leglislators who like to tell the voters about how they're

protecting them from the BAD IRS !

Problem there is the bank products folks have too much power. Imagine if HRB and other giants no longer were able to use the refund to pay their fees? Keep the bank products and the refund is going to a temp account in the name of the taxpayer whether the taxpayer really asked for it or if it's identity theft.

[Gileam]

I am betting a lot of those refunds went on those cards.

Get rid of the cards and problem solved since the others require an address and not just a PO Box.

Better yet, If it is a PO Box. Those get held up in review while they contact the taxpayer