You gathered the documents, crunched the numbers and pushed the button – only to discover that your tax return won’t go through because somebody else filed a fraudulent return using your Social Security number.
The end of another tax season has shown that tax-related identity theft remains a growing problem in Wichita and around the nation.
Although exact local numbers weren’t immediately available, Wichita police Lt. Clark Wiemeyer estimated there were 600 to 650 cases of identity theft in 2012, up from about 550 in 2011. A significant number of those involve the filing of fraudulent tax returns, he said.
“The last few years we’ve had a bunch,” he said.
The IRS reports nationally that in 2013 it has handled more than 200,000 cases of identity theft and issued more than 770,000 personal identification numbers for identity theft in previous years. Since October, more than 670 criminal identity theft investigations were opened.
Since late 2012, the IRS has assigned more than 3,000 employees — more than twice as many as in 2011 — to work on identity theft-related issues.
In December federal prosecutors filed charges against two Wichitans alleging they obtained medical records from the Wichita Clinic and used the personal information to file fraudulent tax returns.
Anthony Hopkins and Ashley Allen are charged with one count of conspiracy to submit false claims for income tax refunds, one count of submitting false claims for income tax refunds, one count of aggravated identity theft and one count of debit card fraud.
For those whose numbers are stolen, the confusion and the work to straighten out their records can be a real headache, said Ryan Deitchler, a counselor at Consumer Credit Counseling Service and a volunteer with a free tax service for low-income people.
He was working last year with a man in his 70s who earned a small income and really needed the money expected in his refund, he said.
Deitchler filed the return for him and discovered that somebody else had already filed a return.
“It’s a giant pain in the backside,” Deitchler said. “Since they’re not likely to be owing money, they’re not likely to get into trouble. But he did have to wait a few months longer, plus all the work and effort. It’s difficult, especially for somebody his age who didn’t really understand what was going on or what to do.”
The use of tax refund loans could dramatically compound the problem, Deitchler said, because interest on the high-interest loans would keep piling up as the taxpayer waited for the IRS to sort through the problem and issue the payment.
A letter or e-mail notification from the IRS informs the taxpayer or their preparer of the reason the return was rejected. The IRS website directs them to file an affidavit and submit it along with a paper copy of the return.
The IRS also directs taxpayers to report it to local police or the state attorney general’s office. The police provide a kit that alerts victims to numbers to call and places to check to see if there have been other thefts using their identities.