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IRS continues to investigate identity theft and tax fraud

In our last post we discussed a recent indictment filed against six individuals accused of a criminal tax fraud conspiracy. Authorities say that the individuals would steal the identities of deceased individuals and then direct returns to accounts in Florida. Checks would be cut and then the funds would be mailed to Ohio for distribution.

This is just one of many tax fraud cases that the IRS and the Justice Department have brought in recent months against individuals in Florida. Identity theft is a large problem and the increased attention on the issue of identity theft is having unintended consequences for some taxpayers.

Often false tax returns using stolen identities are filed early. When the identities of living taxpayers are used, then the taxpayers are typically notified of the fraud when they attempt to file their own taxes.

This can result in a hold on the taxpayer's legitimate refund or an extensive audit. It is important to contact an experienced tax litigation attorney if your identity has been stolen to file a falsified return or if you are accused of filing a falsified return.

"IRS Criminal Investigation has made investigating refund fraud and identity theft a top priority," stated Darryl Williams, Special Agent in Charge, IRS-Criminal Investigation.

Conspiracy to defraud the government can be punishable by 10 years in prison. These conspiracies are often combined with mail fraud which carries a maximum sentence of 20 years in prison. Other possible sentences include 2 years in prison for identity theft. Making a false statement or claim is also punishable by 5 years in prison.

Source: US Department of Justice, "Six Charged in Scheme to Use Identities of Deceased People to Get Tax Refunds," Jan. 25, 2012

Contact Information

L1401 Brickell Avenue, Suite 800
Miami, Florida 33131-3504
Phone: 305.374.5544
Fax: 305.358.8565