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Human error blamed for approval of $2.1 million tax return

On Behalf of | Jun 12, 2012 | Tax Crimes

A 25-year-old woman has been charged with aggravated theft and computer crimes after swindling more than $2 million from the Internal Revenue Service. She incorrectly filed a false personal income of $3 million in 2011 using the TurboTax refund calculator. Her $2.1 million refund was issued on a Visa card with the full refund amount after revenue officials approved her claim.

Approximately 24 million Americans use TurboTax software to file their returns electronically. Using simple math, we can assume that at least half a million people in Massachusetts use the computer program to electronically complete their state and federal tax returns. Can you imagine if everyone got away with that kind of false report?

Though the IRS’ system did red flag her claim for manual review, IRS personnel approved the $2.1 refund. Her claim repeatedly fell through the cracks and she nearly got away with it.

Her mistake came when she reported her refund card lost. Only then did authorities realize their mistake. The woman had already spent $200,000 on a new car and other items. Surveillance video captured the woman purchasing items, signing her name and including her home address for the transactions. Why wouldn’t she? Her refund had been approved every step of the way.

TurboTax returned the remaining $1.9 million to the IRS and the woman is scheduled to appear in court on July 5.

At this point we don’t know if it was an honest mistake, or a slipped key stroke, or pure negligence, but it is obvious that there are some systems checks that need to be revisited throughout the tax return computer software programs and revenue service offices.

Source: nydailynews.com, “Woman arrested for falsely claiming $2.1 million tax refund,” Christine Roberts, June 10, 2012


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