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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 comprised of the Tampa Police Department, Hillsborough County Sheriff’s Office, Postal Inspectors, the U.S. and state attorneys’ offices and the Secret Service announced it had made 49 arrests and uncovered as much as $130 million in fraudulent refunds as part of a recent investigation and crackdown on identity theft-related tax fraud.  It seems that the reason this type of fraud is becoming so prevalent is because it is both easy and lucrative.  Senator Nelson got involved when he discovered that Florida inmates were using basic tax forms to claim phony income or tax credits.  While some illicit Florida businesses are profiting handsomely from laundering phony Treasury checks in what has been referred to as an exploding “underground economy” of tax fraud.

In response, the IRS has sought to hinder the progress of identity thieves while better educating taxpayers on the dangers of identity theft.  Form 14039, the IRS Identity Theft Affidavit, allows the IRS to identify and mark an account to monitor for future questionable activity.  A task force of the IRS and other agencies established a website,, which tells taxpayers what to do if they suspect identity fraud.  Those seeking more information might also want to check out the main IRS website, which includes informational articles such as “Ten Things the IRS Wants You to Know About Identity Theft.”  Finally, for past victims, the IRS has also developed a pilot program designed to lessen delays for victims who deserve a refund.  Participants in this program are assigned an Identity Protection Personal Identification Number (“IP PIN”) to verify that a return is being submitted by the actual taxpayer and not someone who has stolen that taxpayer’s identity.

Taxpayers who are attempting to obtain a refund that was stolen from them may also wish to consult a Florida tax attorney who is knowledgeable in dealing with the IRS and can assist them in their claims.  If you need assistance in obtaining a stolen refund or in any other matter before the IRS, contact an Attorney in Jacksonville to see how they can help you today.