Taxpayer ID theft a growing problem

June 02, 2011|By Larry Margasak, Associated Press

WASHINGTON — Imagine filing your tax return and learning someone else got your refund. With your name and Social Security number, no less.

The IRS saw a nearly fivefold increase in taxpayer identity theft between 2008 and 2010, a Government Accountability Office official plans to tell a House hearing today. There were 248,357 incidents in 2010.

Many identity thieves are not prosecuted, said James White, director of strategic issues for the GAO. “IRS officials told us that IRS pursues criminal investigations of suspected identity thieves in only a small number of cases,’’ he says in testimony prepared for a House Oversight and Government Reform subcommittee. “We want to know why this problem is apparently getting much worse,’’ said panel chairman Representative Todd Platts, a Pennsylvania Republican.

Commissioner Douglas Shulman said his criminal division concentrates on schemes of national scope and added that 95 percent of those prosecuted for refund-related identity theft go to prison. Shulman said the IRS can raise protection after someone has been victimized the first time. Victims are issued an “identity protection personal identification number,’’ which the IRS will use to process future returns.