The IRS Awed by Identity Theft Fraud

Identity theft continues to make life tough for the IRS. This tax season, the IRS is struggling against the onslaught of fraudulent tax returns. In spite of the agency’s efforts to limit identity theft, it still remains a challenge for the IRS. In the just first six months of 2013, 1.6 million taxpayers became victims of identity theft. Compare this to the 271,000 identity theft victims for the entire year in 2010. Considering these statistics, the IRS loses billions of dollars in tax refund fraud every year in spite of its efforts against identity theft.

To inform taxpayers about identity fraud, the IRS issues important alerts, especially during the tax season. Yet the ease with which identity thieves can conduct the crime is making it difficult for the IRS to curb it. It was reported last year that many drug dealers turned to identity theft because it was lucrative, simple and did not involve violence.

As tax season progresses, many identity thieves have been identified and arrested. Yet, fraudulent tax returns are reaching the IRS every day. “This is something that is becoming absolutely rampant throughout the country,” said Joy Cuffee, the IRS’ spokeswoman for the agency’s criminal investigators.

It is not only hardened criminals that are committing identity theft. People who seem the most unlikely to commit crime have been found guilty of identity theft. In one recent case, a shop owner in Southeast Washington was found guilty being a prominent part of an identity theft ring that submitted fraudulent tax returns worth more than $20 million in fake tax refunds. Their targets were mostly drug addicts, prisoners, and people in hospitals.

Even after the IRS’ efforts to stop fraudulent tax returns from getting cleared, if the criminals who file those returns are not caught, this tax crime will stay and grow. This tax season has showed that identity theft is as widespread as it was the last year.

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