The other night I checked the mail in the rain after I got home. I flipped through it all quickly once inside the house. I said hello to the babies and Ken as I noticed that we had an envelope from the IRS addressed to my husband and another woman. An envelope from the IRS addressed to your husband and another woman is probably never a good thing. I decided he must have filed taxes this year with his secret second wife that he had hidden from me on the other side of town. I suppose I wasn’t supposed to see the mail. I decided to get some comfy clothes on before dealing with the mail and while he finished getting dinner ready. I figured I would investigate this secret wife thing after dinner.
I opened the IRS notice eventually after we ate and discovered that yes…his taxes had been filed as “Married, Filing Jointly” with Maria “Blank.” I asked him who Maria “Blank” was, and of course he stated that he didn’t know. We, at this juncture, had yet to file jointly and were planning on this being our first year.
As it turns out, the IRS had sent us this confirmation letter, because a red flag was issued before the IRS would deposit a tax refund for thousands of dollars into the bank account submitted to them on an electronic return. My husband has not gotten a tax refund check in years, so that is one of the things that alerted the IRS to proceed with electronic payment cautiously. They performed a soft credit check, which enables the IRS to gather information such as current address or place of business or work. Apparently the information submitted did not correspond.
The next morning, Ken was able to sit on hold with the IRS for two hours and finally get in touch with a live human being. They were able to verify that he was not married to Maria “Blank” that he did not file the fraudulent return and they were able to put a stop on the pending payment for thousands which was bound for Maria’s bank account or prepaid Visa card. (The really good news was that I wasn’t going to have to file for divorce or murder my husband.) The representative he spoke with on the phone, also claimed that they would be attempting to arrest and prosecute the individual or individuals responsible for the fraud.
The reality of an arrest is actually highly unlikely, as I learned after doing research on the rampant issue of tax refund fraud this year in the US. It is a problem that is costing tax payers billions of dollars. I think it is the most ridiculous thing that the IRS has done, to allow immediate refunds through the internet into accounts or even onto prepaid Visa cards. Most of the articles I’ve read on this type of crime, indicate that users who had previously used the electronic filing methods, such as Turbo Tax, have predominantly been the victims of these crimes. I’ve done my taxes personally, by hand and submitted through the mail for the past 5 years, after catching huge mistakes on my taxes one year by my CPA ,so I wouldn’t be a likely victim of such fraud. The IRS suggests that you do your taxes quickly, in order to keep the criminals from being able to use your information for their fraudulent returns because if yours is done first, it would flag and stop any second attempt to collect. In our case, we were in no rush to file this year, because again, it’s not like we are getting anything back.
The IRS Tax Return system is flawed at best, because it’s set up for trustworthy people to have ease of access to a speedy return. The insanity of letting people have their money sent electronically to a debit card, instead of a bank account is absurdity. Ending that program would instantly save millions. To file a tax return electronically, all someone needs is a name, date of birth and an SSN. The IRS accepts tax filings as soon as Jan. 1, but employers aren’t required to submit correct employment information to the agency until March, by which time roughly half of all refunds have been paid out. (For that matter, the IRS doesn’t begin matching employer-submitted data to tax returns until the summer.)
The really crappy part about all of this, fellow Americans…is that this is our money that is being lost. Some articles and research claims that “gangs outside the country” which to me, is code for “ISIS” -is who is said to be behind the hack attacks that have been responsible for the sensitive data leaks. The country is losing hundreds of millions of our dollars, and if it’s not through this type of fraud, then it’s through the fresh illegals that were recently issued social security numbers and have been rushing to file taxes and get backs thousands per family for credits and benefits that Joe Average is not entitled to. We are losing going and coming. Earning, spending, saving… it doesn’t matter. If you are middle class then you are paying others to come to this country and mindlessly make babies. A family of four can come over, make $18,000 and get back $7000 in the form of a tax refund. There is absolutely no reason that non citizens should be getting back more than they even paid in.
The reality is that this country is broke. Obviously after this record level of tax fraud, we will be even more broke, if that’s possible. Tax Fraud doesn’t mean what it used to. It used to be defined as Harry not admitting to $30,000 in cash earnings or perhaps a small American business getting a bit too liberal with their write offs. This is different. This is bigger. Do the math, people. This is critical.
That’s my tax rant. I don’t mean to be negative sounding, but I do believe in reality and educating yourself. Do some research and learn about the ways to protect your personal information. I’ve included some interesting articles on this type of fraud below. If you read these articles you will be shocked, but there are valuable tips on how to avoid getting your information stolen.
http://krebsonsecurity.com/2015/02/the-rise-in-state-tax-refundfraud
http://moneymorning.com/tag/tax-refund-fraud-2015/
http://www.nytimes.com/2015/02/11/your-money/steps-to-protect-your-tax-data-as-refund-fraud-spreads.html?_r=0
http://www.nbcnews.com/business/taxes/tax-refund-fraud-soaring-little-irs-can-do-n304951
