Aug 292012
 
What To Do If You Are A Victim Of Tax-Related Identity Theft

Tax-related identity theft is on the rise, especially in Florida.  According to a July, 2012 report by the Treasury Inspector General for Tax Administration (TIGTA), an analysis of tax returns processed during the 2011 filing season identified approximately 1.5 million returns with characteristics of identity theft, which caused the IRS to issue refunds in excess of $5.2 billion.  Based on this analysis, TIGTA conservatively estimated that the IRS could issue approximately $21 billion in fraudulent tax refunds resulting from identity theft over the next five years.  Obviously, this type of crime is paying, and so it is reasonable to expect More…

Jul 062012
 
Taxpayer Advocate Service Report Highlights Growing Problem Of Taxpayer Identity Theft

In our last post, we discussed the release of the National Taxpayer Advocate’s 2013 Objectives Report To Congress and the material therein which addressed the issue of the IRS’ increasing use of automation when dealing with taxpayers.  The report also details the growing concern of taxpayer identity theft, something we have previously discussed on numerous occasions. According to the report, “[i]dentity theft wreaks havoc on our tax system in many ways.  Victims of identity theft not only must deal with the aftermath of an emotionally draining crime, but may also have to deal with the IRS for years to untangle More…

Jun 132012
 
IRS Warns Of New Scam Targeting DOD Employees

The IRS is warning taxpayers to be cautious of a new, email-based phishing scam that targets Department of Defense military members, retirees and civilian employees.  According to the IRS, the email appears to come from Defense Finance and Accounting Services (DFAS) and displays a .mil email address.  The email states that those receiving disability compensation from the Department of Veterans Affairs (VA) may be able to obtain additional funds from the IRS. Email recipients are then asked to send various VA and IRS documents containing their personal and financial information, such as copies of VA award letters or their income More…

May 072012
 
Victims Of Identity Theft Must Still Satisfy Their Obligations To The IRS

Since we have previously established that the IRS is willing to make taxpayers wait a substantial period of time for their refunds while they sort out identity theft issues, we are now focusing on whether the IRS will wait for the taxpayer while the issue sorts itself out.  Not surprisingly, the answer is a resounding no. A recent article in the Florida Sun Sentinel highlights the plight of one Florida business owner who was a victim of identity theft.  The business owner had directed that a portion of his $3,562 refund  go toward paying his first 2012 quarterly estimated tax More…

May 032012
 
Professional Football Players Charged In Florida Tax Scam

Three former professional football players are among eight individuals who have been charged in a South Florida tax refund and identity theft scheme.  William Joseph of the New York Giants and Oakland Raiders; Michael Bennett of the Minnesota Vikings, New Orleans Saints, Kansas City Chiefs, Tampa Bay Buccaneers, San Diego Chargers and Oakland Raiders; and Louis Gachelin of the NFL Europe’s Frankfurt Galaxy, are accused of cashing dozens of fraudulently obtained tax refund checks totaling hundreds of thousands of dollars. Federal prosecutors revealed that the FBI was operating an undercover check-cashing store in North Miami that was used by the More…

Apr 252012
 
Florida Tax Preparer Pleads Guilty to Identity Theft and Wire Fraud

According to the Justice Department and the IRS, Ernst Pierre, a Florida tax preparer, plead guilty on April 24, 2012, to wire fraud and aggravated identity theft.  Pierre was charged with a scheme to file false federal income tax returns using stolen identity information. Identity theft in relation to tax fraud is a fast-growing crime across the country.  One reason for identity theft’s rise may be the fact that it is relatively easy.  Experts say identity thieves generally need only three pieces of information to file a fraudulent tax return electronically: a name, a Social Security number and a birth More…

Apr 022012
 
TaxMasters Files For Bankruptcy; Hit with $195 Million Judgment

TaxMasters, the tax firm known for late night commercials featuring Patrick Cox, its red-bearded founder, has filed for bankruptcy and lost a huge civil suit, all in the span of nine days! On March 19, TaxMasters filed a Chapter 11 bankruptcy petition in the U.S. Bankruptcy Court in Houston, citing assets of less than $50,000 and liabilities of between $1 million and $10 million.  Nine days later, on March 27, a Texas jury voted to hit both the Company, as well as its founder and CEO with $195 million in civil penalties, including $113 million for customer restitution, $81 million More…

Feb 172012
 
IRS Releases 2012 List Of The  “Dirty Dozen” Tax Scams

Once again, tax season is upon us and the IRS has issued the annual “dirty dozen” tax scams. Topping this year’s list is identity theft.  In response to growing identity theft concerns, the IRS has declared its intent to embark on a comprehensive strategy that is focused on preventing, detecting and resolving identity theft cases as soon as possible.  In addition to the law-enforcement crackdown, the IRS has stepped up its internal reviews to spot false tax returns before tax refunds are issued and has been working to help victims of the identity theft refund schemes. The entire list is More…

Sep 262011
 
Taxpayer Identity Theft On The Rise

Imagine filing your tax return and learning that someone else got your refund by using your name and Social Security number.  It seems that identity theft is on the rise everywhere these days, including the realm of personal income taxes.  The IRS is said to be grappling with a nearly five-fold increase in taxpayer identity theft between 2008 and 2010, identifying 470,000 cases of identity theft over the last three years. In Florida, U.S. Senator Bill Nelson recently unveiled legislation aimed at stopping criminals from filing fraudulent tax returns with stolen Social Security numbers.  At the same time, a task-force More…