Law Abiding Taxpayer Hit By ID Fraud Multiple Times

5:02 PM, Apr 22, 2013   |    comments
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WASHINGTON, DC (WUSA) -- "There's a reason I named myself Mark.  Mark is a victim of a swindle."

Swindled by someone who stole his identity and made off with his 2011 tax refund. "Mark" filed for an extension and dropped his return in the mail at the post office on Pennsylvania, N.W.  But eight weeks later, with no check in sight, he reached out to the IRS for answers.

"She said, "Sir, you are the victim of identity theft," he says. 

And just like that, "Mark" joined the one percent of Americans whose tax returns get hijacked by criminals intent on robbing them again and again.

He says, "I get this notice from the IRS.  'We're holding your refund until we finish reviewing your tax return.'  This is the 2012 tax refund.  I never filed my 2012 tax refund.  Who did?"

That's right.  "Mark" got hit two years in a row.

"They've even told me in 2013 I might get hit again, if this isn't stopped," he says.

"The IRS is under mandate from Congress, that they had to speed up refunds.  What happens is they issue the refund, then try to figure out what the story is," says Adam Levin.

Levin is an expert on identity theft.  He says tax ID fraud has become such a huge problem hat even the IRS is overwhelmed.

The Tax Form That Can Save Your Refund From Thieves

"I think it's very important actually to scare people.  I think one of the biggest problems is that people are taking the whole issue of identity theft lightly," Levin says.

It's a haunting crime crooks can commit in the shadow of technology.  It is often hard to spot and prosecute.  But, the IRS says it's efforts in 2012 helped to protect $20 billion in revenue to fraudulent returns. 

"This is the initial affidavit I signed for the IRS.  There's also another one for the FTC," says "Mark."

He now says he wished he had practiced some patience to wait in line to send his return by certified-registered mail. 

It would have been a small price to pay to avoid being a victim of tax ID fraud.

And he says, "If the line is around the block, I will in there, waiting."

Now, the investigation for "Mark's" case will not even begin until 180 days after he submitted his paperwork to the Internal Revenue Service.

The agency tells WUSA 9 that these cases are extremely complicated and made even moreso by thieves who will call pretending to be the victim.

IRS Intesifies National Crackdown On Identity Theft

To protect your self, take these precautionary steps.

File early.

Make sure the tax preparer is legit

IRS Wants You To Report Phishing

Get encryption software on your computer to file taxes

IRS Free File

And, if you don't get your refund within three weeks of e-filing or six weeks of mailing, that could be a red flag that something is wrong.

FTC Offers Tax Identity Theft Advice 

A Haunting And Growing Crime For Millions

If you feel you've been a victim of tax ID fraud, call the IRS Identity Protection Specialized Unit at 800-908-4490.

Digital Citizen Alliance Tax Scam Report key points:

The IRS will not initiate contact with taxpayers by email or request personal or financial information.

Your tax documents have all the information an thief needs to steal your identity.  Properly store and shred your old tax returns .  It is one of the most important steps you can take all year. 

Spam has a target audience, but not always.  Criminals know exactly who they want to snake with fake emails known as spear-phising. 

Pirated tax software is common and opens your computer up to malware.

There are some online tax preparation services can also be home to scams.

Tax software is being replaced by online services.  It also exposes taxpayers to new risks from crooks who come up with get-rich-quick schemes. 

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