Archive for the ‘Tax Fraud’ Category

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In the past several years, the number of incidents of related to consumers’ tax returns has surged, and there seems to be little the Internal Revenue Service can do about it. Now, some experts say that a major reason for this increase in fraud could be the result of the agency’s e-filing option.

The ability to submit one’s taxes online is a major convenience for both Americans across the country who may fret every filing season, as well as the IRS itself, which can handle the hundreds of millions of submissions it receives every year more expediently, according to . But all that ease of use can also pose a major problem for taxpayers because it opens the door for identity thieves to more quickly get in and out of the system when they try to commit fraud.


Tax day is months away, but take steps now so you can file your return early—before identity thieves beat you to the punch.

Many victims of tax-related identity theft uncover the fraud after they have filed their returns, leading to delayed refunds and additional problems with the IRS and Social Security Administration.

“One way to stay ahead of the bad guys is to file your taxes early, in January or February,” said Vicki Volkert, an IDentity Theft 911 fraud investigator, who has helped many customers resolve their tax fraud woes.

Here are some additional FAQs about tax-related identity theft from our experts:


Tax season used to be simple for David Parker. His accountant electronically filed taxes for his businesses and investments, and the refund arrived promptly in the mail.

But in the past few years, fraudsters have hit Parker again and again, despite IRS efforts to resolve the problem.

Parker is among a growing number of taxpayers who are becoming repeat victims of tax-related identity theft. “It’s a pattern we’re seeing on the rise,” said Brett Montgomery, a team leader in IDentity Theft 911’s Fraud Resolution Center. “The IRS investigation process takes so long to run its course that victims are getting hit year after year. It’s a vicious cycle.”


Identity thieves who have fallen on hard times, take heart. The IRS is here to help.

If you’re counting on that big tax refund to cover the bills and upgrade your gear to steal debit card numbers and hack into computer systems, this is your year.

The IRS may have delivered to you and your compadres who took the initiative to file fraudulent tax returns in 2011, according to Treasury Department investigators.

Keep your nose to the grindstone, and you’ll see a windfall in the next five years, when an estimated $21 billion could head your way, according to The Associated Press.


Tax-related identity theft is on the rise.

The Internal Revenue Service has flagged 2 million tax returns to review for possible fraud, according to .

That’s close to the total number of returns that were identified for review in 2011—and there’s still one month left in tax-filing season.

To learn more about top tax scams that can lead to tax-related identity theft, read our slideshow. And protect yourself with our .


Taxpayers have another reason to be frustrated with the Internal Revenue Service: Late refunds due to widespread identity theft.

The delayed refunds are a result of the IRS’s work to fight identity-theft-related tax fraud, according to the . Though that means the agency’s efforts are paying off, the downside is a delay for many people of low- to moderate-income who anticipate the funds to pay bills.


The bad guys have a new favorite way to steal your identity.

Used to be crooks snagged a Social Security number to open a credit card and run up charges. Now they’ve found an easier way to make money, according to the , the Federal Trade Commission’s annual report on consumer complaints.


Tax scams abound during tax filing season. Taxpayers can steer clear of trouble by watching for these telltale signs that identity thieves have targeted them.


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Millions of taxpayers are filing their returns online. But how safe is their personally identifiable information?

The IRS where taxpayers can submit their returns without charge if they meet certain eligibility criteria, such as age, income and state of residence.

Our experts took a closer look at the way these companies approach privacy and the handling of consumer data, and they graded the websites based on how well they protect a person’s personal information.


Meeting the April 17 income tax deadline might be the least of your worries.

In recent years, the IRS has seen a significant increase in the number of involving identity theft, according to Steven Miller, IRS deputy commissioner for services and enforcement.

Tax fraud through identity theft can prevent an innocent taxpayer from getting a refund and may cause the IRS to take “adverse enforcement” against him for not filing properly, Miller said.

Jack Baldwin*, a founder and former CEO of a company listed on the New York Stock Exchange, learned about it the hard way.