The Wall Street Journal the other day contained an article by Jay Starkman titled E-Filing and the Explosion in Tax-Return Fraud in which he states:
Tax-identity theft exploded to more than 1.1 million cases in 2011... The IRS has a backlog of 650,000 cases.
Those numbers don't jive with the GAO which reports :
As of September 30, 2012, IRS had identified almost 642,000 incidents of identity theft that impacted tax administration in 2012 alone, a large increase over prior years.
Maybe the way to square the two is to assume the 2012 cases are the ones backlogged.
My fraudster came to my attention in April 2012 when I tried to file my 2011 return online through H&R Block's software program. It was rejected because someone else had already filed one with my name and SS number. So I wasted two hours at the local IRS office trying to find out what happened and what to do with it. Actually, 1.5 hours was wasted waiting to talk to an actual person, the other half hour was wasted talking to said person.
The effort wasn't 100% wasted, however. I did learn from her that someone had filed a return using a Dallas address requesting a $9,000 refund which at that time had not yet been paid. She refused put a hold on it or to do anything further because I had not brought a copy of my return with me. Her suggestion that I go get it, return, and get in back of the line was declined. She did, however, point me to the IRS form for declaring an identity theft.
Here's a link to the Identity Theft Affidavit form 14039 pdf for 2012. If anyone reading this suffers a similar fate, don't waste time going to an IRS office, just download the form, fill it out and mail it in. And in all future years try to pay just enough taxes throughout the year so that you won't have to ask for a refund.
Any criminal investigation in my case is unlikely: "IRS conducts criminal investigations only in the most serious identity theft-related refund fraud cases," says the GAO. That $9,000 is chicken feed to the U.S. government, but I do wonder if they actually paid it out.
Meanwhile, Paul Bedard says in Washington Times that the response time for help from the IRS has gone from bad to worse.
It's time for a flat tax.