DOJ and IRS Team Up to Combat Fraud

The IRS has two main goals when it comes to ideal operations: fraud prevention and fast disbursements of refunds. These two distinctly different goals can be difficult to attain as the application of one could hinder the other.  Essentially, the DOJ plans to take information from local prosecutions to identify patterns in the cases and help the IRS create computerized filters to block potentially fraudulent refunds. They peak each year in the first few weeks of the filing season as criminals try to get refunds under legitimate taxpayers’ names before those people file their own returns.

The IRS boasts preventing 15 billion in erroneous payouts this previous tax season, up from 11 billion the year before. Still that leaves 19 billion that was paid out in error due to potentially fake EITC claims and American Opportunity Credits that go unscrutinized.

After the ITIN department fraud scandal, Texan Republicans were calling for the resignation of IRS Commissioner Shulman, who, according to sources, does not plan to stay with the IRS after the up-coming end of his term. He did, however, give some advice, saying that “we need to rethink the speed of refund paradigm”, especially the assumption that refunds should be paid out as quickly as possible.

Posted: October 1, 2012

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