Beat the bad guys to your tax refund
Fraudulent returns scored crooks $5.8 billion in 2013
By Kevin McCormally |Kiplinger
Here’s another resolution for the new year: File your tax return as
soon as possible. We’re not simply anti-procrastination. We want you to
get your money, and one of the surest ways to make sure you get your
refund before an identity thief does is to file as soon as you can.
Once again this year, about 110 million taxpayers will request
refunds from the IRS, but, if history is any guide, about 1 million
filers might discover that someone else has already claimed their money
with a phony tax return. That’s how many fraudulent returns in 2013
scored $5.8 billion in ill-gotten gains for the crooks who filed them.
The honest taxpayers who came to the party late had to fight to prove
the money was really theirs. According to the Treasury Department’s
Inspector General for Tax Administration, it took an average of 278 days
— more than nine months — for those cases to be resolved so the rightful
owners got what they were due.
The IRS claims it stopped another 4.1 million phony returns in 2013,
preventing almost $25 billion more in tax-refund fraud. (No one has any
idea how much fraud went undetected.) But just before this past
Christmas, it was disclosed that the tax agency accidentally paid nearly
$50 million in refunds in 2013 on returns that had been flagged as
potentially fraudulent. The computer program that was supposed to put
the brakes on the refunds instead sent them merrily on their way to
crooks’ bank accounts and debit cards.
The IRS says it’s gotten better at identifying phony returns, but
it’s clear that a serious flaw remains in the system: The tax agency
pays the vast majority of refunds long before it has a chance to check
the information on the return against the W-2 income and withholding
information provided by employers.
While the law says employees must get their W-2s by January 31, in
most cases the information doesn’t get to the Social Security
Administration until March 31 — and only after that is it passed on to
the IRS. In the meantime, a fraudster with your name and matching Social
Security number can make up wage and withholding data to claim a refund.
What does this mean to you?
You might want to root for the IRS to do a better job stopping the
bad guys (and Congress has helped by ordering that, starting next year,
employers must give W-2 data to the IRS a little earlier).
But on a more personal level, make a commitment to file your 2015
return as soon as you can. The IRS says it will begin accepting
electronic returns on January 19 and start processing paper forms the
same day.
Once you get your W-2, 1099s and any other information needed to
complete your return, fire up the software or grab your pen to do it
yourself, or schedule time with your accountant, enrolled agent or other
preparer.
The sooner you file, the sooner you’ll get your money back — and the
less likely a crook will beat you to it.
--
*================================================ Duane Whittingham -
N9SSN (ARES/RACES, EmComm, Skywarn & Red Cross)
http://www.radiodude.info ================================================*
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