Stolen Identity—Here Come the Tax Refund Checks!

tax man 300x200 Stolen Identity—Here Come the Tax Refund Checks!There are several different ways people can get in tax trouble with the IRS.  Here are some mentioned by

  • Claiming false deductions
  • Concealing or transferring assets or income
  • Knowingly changing your income
  • Over reporting the amount of deductions
  • Possessing two set of books
  • Recording personal expenses as business expenses
  • Using false amounts in books and records

Another way, which may not readily be thought of, is through Identity Theft.  Identity theft is “the illegal use of someone else’s personal information (as a Social Security number), in order to obtain money or credit.”  Identity thieves lurk everywhere.  They are not simply online hackers or common criminals that rummage through confidential documents in the corporate world; they can be friends, neighbors, family, associates or complete strangers.  In fact, they can be prisoners who can steal people’s identities and use them for the purpose of collecting tax refunds!

Last year, in fact, the IRS stepped in and prevented over $2.3 billion from being stolen by prisoners.  Yes, inmates pay and can collect taxes too.  They can file taxes online, if needed, and have monies deposited into friends’ bank accounts, which could very well fund underground, illegal activity.  Laws have been passed recently, which are supposed to make it easier for the IRS to monitor inmates’ tax information.  Of course, if they are filing under a different identity and haven’t been caught, they could still be hard to catch.

Some ways prisoners may obtain stolen identities to claim fraudulent refunds are as follows:

  • Through the use of the internet and reading obituaries, social security numbers may be obtained of the recently deceased.
  • Identities may be stolen from fellow inmates.
  • Companies that have filed for bankruptcy may be a target for them.  They can claim to have been employed there and try to obtain a tax refund that way.

Fortunately, the IRS is always looking for ways to close tax refund/evasion loopholes, and monitoring of inmates’ tax information has been improved upon in the past year.  Still, in the midst of tax season, it’s always good to have awareness of potential crimes that could occur and how to avoid the pitfalls.  Safe guard your information as best you can.


photo credit: <a href=””>Alan Cleaver</a> via <a href=””>photopin</a> <a href=””>cc</a>

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About Kristal Heffley

Ad Review and Social Media Specialist of BBB serving Northern Indiana. Kristal spends a great deal of time learning, writing about, and educating the public on scams of the day. She also is quite the social-media enthusiast and community partner. You can follow her posts, i.e. BBB serving Northern Indiana on Facebook, Google Plus, Instagram, LinkedIn, Twitter, YouTube, and of course, our blog.