Released: April 14, 2008

A call for action on tax scams

Source: Stephen Barr, Washington Post (Free Registration)

The scam goes like this: A bogus tax return using a stolen Social Security number is submitted to the Internal Revenue Service early in the tax-filing season. Because the IRS does not know the return involved identity theft, it sends a refund.

When the real tax return is filed, it gets flagged as a duplicate, freezing any refund. It sometimes takes months for the innocent, legitimate taxpayer to sort it all out with the IRS.

Filings of fictitious tax returns to steal refunds have jumped dramatically, perhaps because con artists can file them electronically and get a direct-deposit refund long before the real taxpayer finds out.

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