IRS Cracks Down on Identity Theft Nationwide

In a press release from January 31, 2012, IRS commissioner Doug Shulman announced the results of a nationwide effort to cut down on identity theft and refund fraud. The IRS worked in conjunction with the Justice Department’s Tax Division and local U.S. Attorneys’ offices to target more than one hundred people across twenty-three states. The sweep resulted in 939 criminal charges against would-be tax frauds.

In addition to the sweep, IRS auditors and investigators visited approximately 150 money-service businesses to conduct extensive compliance visits and insure these businesses aren’t engaged in practices which may facilitate refund fraud and identity theft.

Taxpayer identity theft normally occurs when a thief uses a legitimate taxpayer’s identity to falsely file a tax return and claim a refund. A victim of identity theft is rarely aware their identity has been stolen until he or she attempts to file a legitimate return later in the tax season and discovers that another return has already been filed using their Social Security Number.

If you receive an IRS notification for any of the following reasons, you should take immediate action:

  • More than one return was filed for you in a single tax year
  • You have a balance due, refund offset or have had collection actions taken against you for a year you did not file a tax return, or
  • IRS records indicate you received wages from an employer unknown to you.

Immediately respond to the name and number printed on the letter if you receive such notification.

The IRS advises you to minimize your risk of identity theft by:

  • Rarely carrying your Social Security card or documents with your SSN on them.
  • Disclosing your SSN only when required. Many businesses may ask for your SSN but do not actually need it. Do not give out your SSN unless absolutely necessary.
  • Protecting your financial information, both online and in print.
  • Checking your credit report periodically. You may check your credit without charge once a year at,, or . By using each of these services only once each year, you can actually check your credit report every four months.
  • Protecting your personal computers using firewalls, anti-spam and anti-virus software. Keep your software current via frequent updates. Use secure passwords and change them often.

By taking action against tax fraud criminals, Commissioner Shulman sends a clear message to anyone considering participation in a tax fraud scheme. He said “We are aggressively pursuing cases across the nation with the Justice Department, and people will be going to jail”. The IRS is taking additional steps to prevent identity theft and detect fraud by using new identity-theft screening filters and placing identity-theft indicators on taxpayer accounts to track and manage incidents of identity theft. Despite these advances, you should always be vigilant in protecting your Social Security number and financial information.

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