According to the U.S. Government Accountability Office, income tax identity theft is a major problem in Georgia and across the United States. The crime costs taxpayers around $6 billion each year.
Tax identity theft occurs when a criminal uses a stolen name and Social Security number to file a fraudulent income tax return in order to get a refund from the Internal Revenue Service. There have been several large tax fraud rings broken up this year. Members of different gangs in California, New Jersey and Florida were arrested and charged with various income tax identity theft crimes, including counterfeiting W-2 forms.
In May, the IRS announced the hacking of its "Get Transcript" program, which allows taxpayers to access their federal tax returns from previous years. The scam affected around 330,000 Americans and resulted in $50 million being bilked from the government. Apparently, criminals were able to access the program because the IRS verification system used information that could be found in public data bases and on social media sites. Experts say that regulation changes made by the government to prevent future data breaches are largely ineffective. In order to protect themselves, taxpayers should file their 2015 federal income tax returns as early as possible in order to prevent identity thieves from preemptively filing a fraudulent tax return in their name.
Georgia taxpayers who believe that they have been the victim of income tax identity theft may benefit by speaking with a tax attorney. Legal counsel could work with the client and the IRS to sort out the issue.