- Bargaineering - http://www.bargaineering.com/articles -

IRS Identifies 2 Million Fraudulent Tax Returns

You might not be surprised to learn that the IRS has a fraud detection system, I suspect it’s similar to the system they use to pick which returns to audit [3], but you might be surprised to find that it has detected [4] roughly two million “potentially fraudulent” tax returns last year. It’s an increase of 72% from the previous year and that doesn’t count the million (actual number is around 900,000) tax returns that were part of “Operation Mass Mail.” Operation Mass Mail was a scheme in which tax cheats submitted fraudulent returns that were automatically voided before they were processed (unfortunately, tens of thousands of those returns were actually legitimate).

It’s part of a larger story about how the IRS is underfunded and how it’s been unable to keep up with demand. Apparently, you could only get to someone on the phone after waiting for an hour and the IRS could only answer one out of every 9 calls it received from taxpayers wondering where their refunds were. It really makes you wonder if the IRS is mismanaged or if they simply don’t have enough people. Unlike other agencies, it seems like IRS is one that we’d want to fully fund since it’s responsible for collecting our revenue. 🙂