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Friday, January 18, 2013

TIGTA: Prisoner Tax Fraud Claims Continue to Skyrocket

TIGTA The Treasury Inspector General for Tax Administration yesterday released  Further Efforts Are Needed to Ensure the Internal Revenue Service Prisoner File Is Accurate and Complete (2013-40-011):

Refund fraud committed by prisoners remains a significant problem for tax administration. The number of fraudulent tax returns filed by prisoners and identified by the IRS has increased from more than 18,000 tax returns in Calendar Year 2004 to more than 91,000 tax returns in Calendar Year 2010. The refunds claimed on these tax returns increased from $68 million to $757 million. Although the IRS prevented the issuance of $722 million in fraudulent tax refunds during Calendar Year 2010, it released more than $35 million. Figure 1 shows the number of fraudulent tax returns identified by the IRS as filed by prisoners in Calendar Years 2004 through 2010 and the related refund information.

Figure 1:  Fraudulent Tax Returns Filed by Prisoners for Calendar Years 2004–2010

Calendar Year

Fraudulent
Tax Returns

Refunds Claimed
(Millions)

Refunds Prevented
(Millions)

Refunds Issued
(Millions)

2004

18,103

$68.1

$54.6

$13.4

2005

21,254

$80.4

$67.5

$12.8

2006

N/A

N/A

N/A

N/A

2007

37,447

$165.9

$136.6

$29.2

2008

47,898

$190.4

$162.1

$28.3

2009

44,944

$295.1

$256.0

$39.1

2010

91,434

$757.6

$722.4

$35.2

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