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Crackdown on identity theft and tax fraud

| Oct 23, 2013 | Tax Crimes

While many federal workers in Massachusetts and elsewhere were furloughed in the beginning of October as a result of the federal government shutdown, many federal law enforcement agents were working to crack an alleged tax fraud scheme centered in South Florida. As a result of the investigation, 45 individuals are facing charges for various tax crimes in 30 different cases.

The majority of charges are for tax refund fraud and identity theft, two areas that are being given top priority by the Internal Revenue Service. The Service has increased enforcement to prevent this fraud, and in 2012 stopped $20 billion in fraudulent refunds from being processed. It is predicted that the IRS could issue up to $21 billion in fraudulent tax refunds by 2018.

Law enforcement agencies involved allege that they prevented $40 million in losses from occurring. One such agency was the South Florida Identity Theft Tax Fraud Strike Force, a group that was organized in 2012 to establish a partnership between local, state and federal agencies. This organization has charged 269 defendants with identity theft since its inception. The 45 individuals are accused of stealing in excess of 20,000 identities. Authorities allege that the identity thefts caused more than $11.5 million to be lost through fraudulent tax returns.

A Massachusetts tax attorney may be able to help a client who has been imposed penalties by the Internal Revenue Service for underpayments or failure to file income tax returns. The attorney may be able to help negotiate and prepare a settlement agreement that will allow the client to make periodic payments and avoid further sanctions.

Source: Forbes, “Massive Tax Fraud Takedown During Government Shutdown“, Kelly Phillips Erb, October 21, 2013

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