IRS Pays Billions in Fraudulent Refunds

It’s not great to learn that your hard-earned tax dollars are being sent by the government to scamsters. The Inspector General for Tax Administration reports that the IRS has paid out billions of dollars in tax refunds to identity thieves. If the situation is not corrected, fake refunds could total $21 billion over the next 5 years.

The IRS has already detected more than 1 million false refund claims for 2011, saving taxpayers $6.5 billion. However, the Inspector General found another 1.5 million such claims, the refunds on which could total more than another $5 billion. Conclusion of the report: The IRS needs to do more than it already is to avoid substantial revenue losses in the future.

Source: Report No. 2012-42-080