Tax Identity Theft: Yet Another Threat to the Public

Tax Identity Theft

It's tax time. And with the deadline for filing, April 15, looming in the not so distant future, many last minute filers scramble to get their returns completed. For many, there may already exist a great deal of anxiety around preparing their tax returns. However, as a USA Today article points out, there may be an even greater cause for anxiety. That's finding out that someone else has used your name and Social Security number to file a return - and collect a fraudulent refund.

How prevalent is the problem? The USA Today opinion piece cites that in 2012, there were 1.8 million such incidents. Reportedly, one address in Lansing, Mich. was used to file 2,137 tax returns in 2010, and one bank account had been used to receive 590 direct-deposit refunds that totaled over $900,000. The article further goes on to cite that victims may spend six months or more than a year to resolve an identity theft case.

In response to the article, Beth Tucker, deputy commissioner of the IRS, acknowledged that identity theft is a complex issue to fight. However, the IRS has taken new steps to stop fraudulent refunds from being issued in the first place. For example, the IRS has strengthened its security filters for fraudulent indicators such as thieves attempting to file multiple returns to the same address or for a single bank account. With these stronger protections and security filters in place, Tucker asserts that the IRS has already blocked 2 million suspicious returns, and last year the IRS blocked more than $20 billion in fraudulent refunds compared to $14 billion in 2011. As for victims, the IRS reportedly issued 770,000 identity theft PIN numbers to protect confirmed victims to help resolve 500,000 cases from last year and an additional 200,000 cases have been sorted through and closed since January of 2013.

To learn more about Tax Identity Theft, visit the IRS website.

Reference: USA Today, Friday, April 12, 2013, "As identity thieves thrive, IRS 'moving backward'

Anyone with information concerning insurance fraud or vehicle theft can report it by calling toll-free 800.TEL.NICB (800.835.6422) or submitting a form on our website.

About the National Insurance Crime Bureau: Headquartered in Oak Brook, Ill., the NICB is the nation's leading not-for-profit organization exclusively dedicated to combatting and preventing insurance crime through Intelligence, Analytics, and Operations; Education and Crime Prevention; and Strategy, Policy, and Advocacy. The NICB is supported by more than 1,200 property-casualty insurers, self-insureds, rental car, vehicle finance, and auto auctions. To learn more, visit www.nicb.org.