Authorities in Florida are dealing with thousands of stolen identities and millions of dollars in stolen tax refunds. Federal charges have been filed for tax identity theft against forty defendants in twenty cases across the state. Federal prosecutors teamed up with the IRS Criminal Investigation division, Secret Service, FBI, Social Security Administration and local police departments to crackdown on the growing plague of fraudulent tax filings.
As of September, Florida has had the highest rate of tax identity theft in the United States. $280 million in fraudulent tax refunds have been issued to roughly 74,496 potentially false tax returns. There are approximately 178 complaints of identity theft per 100,000 residents in the state. The numbers increase in Miami, where the rate nearly doubles to 324 reports per 100,000 people. Miami’s average is 46 times the national average.
Tax identity theft affects thousands of taxpayers every year. Criminals file false tax returns, taking inflated deductions and false tax credits to maximize the tax refund check. Fake tax preparers will file the income tax return for their victims but enter in a fake address for the refund check to be mailed to and disappear when it arrives. Victims of tax identity theft discover there is a problem long after the criminal has fled the area because the length of time to receive a tax refund can vary from individual to individual. In some cases, victims only realize there is a problem when the IRS sends notice that they have already filed a tax return and received a refund.
This year alone, the Tax Identity Theft Strike Force has charged just seventy nine individuals for filing $40 million worth of fraudulent tax returns in Florida. Tax identity theft across the nation is expected to cost the IRS about $21 billion over the next five years.