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Just imagine, you've filed your tax return and are eagerly awaiting your refund. It's money you desperately need to pay some bills or buy whatever you've been hankering for.
But then you get a notice from the Internal Revenue Service saying that your return has been rejected. You won't be getting a refund because it has already been claimed. You've become a victim of identity theft. Now identity theft becomes very real. And it's getting frustratingly real for a growing number of taxpayers.
Typically, an identity thief will steal someone's personal information, including his or her Social Security number, and file a bogus return claiming a refund. This is often done early in the tax season, before most people have a chance to file their legitimate returns. "In some situations, fraudulent filings may cause us to initiate an adverse enforcement action against the innocent taxpayer until we are able to confirm that someone else has used his or her information," the IRS said in written testimony submitted to the House of Representatives.
When defrauded taxpayers aren't getting the help they need from the IRS, they can turn to the Taxpayer Advocate Service. From 2008 to 2012, the number of tax-related identity theft cases the service handled increased 650 percent, according to the latest report to Congress from the national taxpayer advocate, Nina Olson. During fiscal 2012, the service worked 55,000 identity theft cases, or 25 percent of its total case inventory, Olson said.
Here are just a few recent cases reported by the IRS:
● A Chicago man was sentenced on Jan. 8 to 62 months in prison for filing fraudulent returns using the identities of prisoners and deceased persons.
● A former service member filed fraudulent claims for federal refunds by targeting fellow Marines, many of whom served in his unit in Afghanistan. He stole more than 100 names, dates of birth and Social Security numbers.
● A Memphis woman was sentenced to 262 months in prison and ordered to pay almost $700,000 in restitution to the IRS. Some of the stolen identities came from a "warrant book" of the Memphis Police Department. She would give the information to others, who used it to prepare and electronically file fake returns that claimed refunds.
Source: Washington Post | Michelle Singletary
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