173,000 false returns filed by inmates
WASHINGTON — Tax fraud appears to be a popular pastime in the nation's prisons, but the Internal Revenue Service is catching on.
The IRS detected more than 173,000 fraudulent tax returns from inmates last year — more than twice the number of fraudulent returns detected from inmates in 2010, according to a report on Thursday by the Treasury Department's inspector general for tax administration.
Much of the tax fraud involved stolen identities and other false information in an attempt to get tax refunds.
In all, the IRS said it has stopped inmates from illegally claiming $2.5 billion in tax refunds in the 2012 budget year. About $1.1 billion was claimed by just two inmates.
The report credits the IRS and prison officials with stepping up enforcement and sharing more information, but it says more can be done to stop tax fraud among inmates.
The heavily redacted report contains few details about inmates' scams and no information about how two prisoners thought they could get the federal government to send them more than $1 billion. Tax information, even for inmates, is private unless a person gets charged with a tax crime.
The IRS says it aggressively prosecutes fraud.
Over the years, investigators have found that crafty inmates will go to great lengths to try stealing identities or tricking the IRS into sending them a refund they don't deserve, said inspector general spokeswoman Karen Kraushaar.
Some inmates scour obituaries, looking for people's identities to steal. Others use the identities of fellow inmates or even their own. Some use their access to computers to file tax returns online. They can have refunds electronically deposited into the bank accounts of friends on the outside.
Some inmates have identified businesses that have filed for bankruptcy and claimed to work there — using the bankruptcy as an excuse for why the company didn't send them a W-2 form.
“Most taxpayers find e-filing to be quick and easy. Unfortunately, some bad guys found also it is a quick and easy way to commit fraud,” Kraushaar said. “To the IRS' credit, our report found that they are doing a much better job of stopping such fraudsters in their tracks.”
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Survivor: Oregon college gunman spared 1 to give police a message
- Oregon college gunman’s victims walked varied paths
- Double whammy for dinosaurs: Death from above, below
- Another round of divisive cases awaits Supreme Court
- Obama won’t sign Congress’ stopgap budget bill
- Football game in St. Louis halted by gunshots
- Navy intelligence official indicted on charges of theft, conspiracy
- W.Va. native killed as C-130 transport plane crashes in Afghanistan
- As GOP prepares to elect new House leadership, no end to infighting in sight
- California vineyards skip irrigation amid drought
- Apartment blast kills 1 in Brooklyn