IRS Tax Fraud Increasing

IRS Tax Fraud Increasing

Identity theft linked to IRS tax fraud has been increasing. However, according to a recent government report, the IRS is actually unaware of the number of persons who are running scams on the system.

Based on a study from the Government Accountability Office (GAO), a watchdog that collaborates with Congress, between January and September 2012, there were approximately 642,000 incidents of identity theft which involved tax fraud, which is 62 percent more than 2011. The report further stated that during that same period of time, the IRS would have paid some $754 million in refunds that were suspicious.

The report also shared that returns that involve identity theft are hard to track. The IRS informed the GAO that it is unable to determine why and how this is happening. American taxpayers who have been victims of identity theft and false returns, may experience delayed refunds and have to pay additional costs for re-filing, in addition to the tons of paperwork.

The Government Accountability Office is an imp...
The Government Accountability Office is an important information-gathering agency for Congress. (Photo credit: Wikipedia)

Unfortunately, the tax and fraud professionals advised that this problem in increasing because it is easy to run the scam via electronic filing such as turbotax 2011. Once scammers have someone’s Social Security number and name, they can apply for the refund to be transmitted via direct deposit. Therefore, it is difficult for the IRS software to determine the legitimacy of the returns that are filed.

This problem is estimated to burden the US Government by billions of dollars. CNBC reported that the IRS inspector general forecasted an estimated $21 billion that could be paid out over the next five years in tax refunds that are fraudulent.

One of GAO’s directors, James White, shared with The Huffington Post that this problem is hard to solve and partnering with the banks could be one of the solutions. During the first nine months of 2012, 116 banks reported information to the IRS about over 193,000 accounts that were linked to tax fraud. White further stated that this type of crime is hard to catch and measure.

The IRS was able to block an estimated 262,000 fraudulent tax returns in 2011. However, according to CNNMoney, approximately $5.2 billion was lost to identity theft.

Tax Carnival Ecstasy – February 16, 2012

taxes
taxes (Photo credit: 401K)

Welcome to the February 16, 2012 edition of Tax Carnival Ecstasy. In this edition we have an article by Bill Smith on Discharging Your Tax Debts In Bankruptcy Court. Pat Huddleston wants you to protext yourself from fraud in Accountants; A Love Story. And finally we have 8 Tips to Prepare for Retirement including a tax perspective. Hope you enjoy the articles, bookmark, share, tweet, like on Facebook and come back soon.

filing

Frank Goley presents Bond Analysis posted at Easy Forex News.

tax law

Bill Smith presents Can You Discharge Your Tax Debts In Bankruptcy Court posted at 2008 Taxes, saying, “There are many debts that you can discharge through bankruptcy. Is tax debt eligible for discharge through bankruptcy?”

taxes

Jessica Bird presents How CO2 Affects The Cost Of Your Car Tax posted at CarTaxBands.org, saying, “The amount of pollution that your car emits can have an affect on how much tax you pay. This article shows you how to find out what the CO2 emissions are on a car.”

Ranjita patra presents Top 4 Supply Management Trends Impacting Finance | Business Finance posted at Businesss Finance.

Bill Smith presents 8 Tips to Prepare for Retirement posted at 2008 Taxes, saying, “Whether you’re just starting to plan for retirement, or you’re retiring in the next year or two, there’s never a bad time to learn how to prepare yourself for the wonderful world of retirement.”

tips

Amy Gardner presents Average Interest Rates for Payday Loans posted at Payday Loans Online Resource.

Pat Huddleston presents Accountants; A Love Story | Investor’s Watchblog posted at Investor’s Watchblog, saying, “Tips on how to protect yourself from fraud”

That concludes this edition. Submit your blog article to the next edition of tax carnival ecstasy using our carnival submission form. Past posts and future hosts can be found on our blog carnival index page.

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The Impotance Of Good Credit Report

Anyone can obtain cheap credit report and scores that are pertinent to their personal credit file. Individuals who are concerned about rectifying, and rebuilding their credit history, may already to aware of some free offers. For instance, anyone can request a free copy of their credit report from all three major credit bureaus. These reports are available at the consumers request once a year, at no charge. This is a perfect way to eliminate identity theft, and keep up with credit scores.

Many people have found that keeping track of their credit score helps them maintain control, of their financial obligations. Not knowing everything that is listed on an individual credit report can be damaging, especially when applying for credit. Some people don’t realize that they have erroneous, or outdated information on their credit report, until after they have neither applied for a loan, or been rejected for a job.

The importance of maintaining a good credit history is vital. Many people who need a loan to maintain, improve, or start a new business, find that low credit scores, and bad credit, can hinder the owner from expanding their business. For individuals who may be looking to improve their credit score may be interested in credit repair. Credit repair resources such as classes, and workshops are available to consumers free of charge. The fee to repair individual credit reports can be quite expensive.

Individuals who are interested in saving money, and having misinformation removed from their credit file, have another alternative. They can contact the three national credit bureaus and follow their procedure, on how to have erroneous information removed. This is a free service to consumers. Although, the process may be a little long, but in the end it is worth the wait. The first step to maintaining good credit is to obtain your cheap credit score, from the three major credit bureaus.

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