IRS Investigations For ID Theft in 2013

in Business Risk

In 2013, the Internal Revenue Service conducted 1,492 criminal investigations for identity theft in the United States. The number of investigations was an increase of 66 percent from 2012.

436 people were sentenced in court for identity theft cases involving tax returns in 2013.

14.6 million tax returns were flagged by the agency for being suspicious between 2011 and 2013. In total, the return flagged as suspicious blocked over $50 Billion in fraudulent tax returns.

In 2012, a total of $4 billion of fraudulent tax returns were issued to people who used stolen identities. The number lost in 2012 was slightly higher than the $3.6 Billion issued in 2011.

The way the scam works is that identity thieves use a person’s social security number to file tax returns early in the filing season. By quickly filing the returns, the thieves can claim refunds before the taxpayer can file. Since the IRS issues most refunds within 3 weeks, the thieves are able to get the tax refund before the legitimate taxpayer is able to file.

Source: Associated Press, “IRS: Identity theft prosecutions double in 2013,” CNBC, January 8, 2014.

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