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Thursday, July 31, 2014
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Published: Saturday, 2/9/2013

Identity theft an extra worry at tax season, IRS cautions

BY KRIS TURNER
BLADE BUSINESS WRITER

The Internal Revenue Service is cautioning taxpayers against an additional headache this tax season: identity theft.

Identity thieves are targeting tax returns as a way to make a quick buck, Acting Commissioner of the IRS Steve Miller said Thursday during a conference call with media outlets. The federal government has placed an emphasis on catching thieves early in the tax-refund process, he said.

Criminals use stolen identities to seek tens of thousands of dollars in fraudulent tax refunds.

The problem has grown in recent years and the IRS doesn’t want it to continue, Mr. Miller said.

“We’re doing a much better job on all fronts, but we have more work to do,” he said.

The IRS investigated about 900 identity theft-related cases in fiscal year 2012. It has performed 542 investigations in the current fiscal year, which began Oct. 1.

The IRS most recently performed a sweep in January and targeted 389 people in 32 states and Puerto Rico, including 109 who were arrested. The sweep was conducted with the assistance of the U.S. Department of Justice and various U.S. Attorney's Offices.

“These numbers show the IRS is very serious about pursing identity thieves,” Mr. Miller said.

The IRS has a designated unit — the Identity Theft Clearinghouse — that investigates suspicious refunds and leads. It also aids criminal investigations regarding identity theft.

Legitimate taxpayers whose IDs are stolen often must wait months to get their refunds. Mr. Miller said there’s a backlog of 300,000 cases and an average wait time of 180 days for a resolution.

Mr. Miller did not have a figure for the amount of much money that had been paid out to identity thieves who had not been apprehended. He said the IRS was trying to quantify that number.

Nancy White, a partner at Toledo’s All Pro Tax & Accounting, said her firm shreds all client information and does not simply throw away documents that could lead to identity theft. Ms. White, who said the problem has become more prevalent in recent years, said people will have an easier time filing their taxes if they work with a professional.

Aside from identity theft, people could make a mistake on their tax forms that could cost them, she added.

“One of the things we do is to make sure all their private information is shredded. What we would throw away otherwise we shred,” Ms. White said. “Nobody can get into our systems and get any information. It’s all guarded.”

If you suspect that you are a victim of identity theft, contact the IRS at 800-908-4490.

Contact Kris Turner at: kturner@theblade.com or 419-724-6103.



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