Tax Fraud Trend: Returns Filed in Rivertowns Residents' Names

More and more, when residents go to submit their tax returns, they are finding that someone has fraudulently filed them in their names.

With tax day looming everyone's a little on edge, but even more jarring than finally submitting the forms is finding out that someone has already submitted them for you. 

Local police are discovering a scary trend of residents reporting that when they go to file their taxes, someone has already done it—fraudulently—in their names. 

Last week, two Hastings residents were notified by their accountants that someone had already filed tax returns in their names. When a 74-year-old Hastings resident tried to file her taxes electronically on Tuesday, March 27, her accountant called and said they'd been submitted by someone else.

Later in the week, a Maple Avenue resident reported the same issue, without any idea of who filed them or when.

"This is something that's new to us," said Hastings police Lt. David Dosin. "We really hadn't seen it in the past."

In Dobbs Ferry this week, a 42-year-old woman reported that tax returns had also been filed in her name in March. However, the fraudulent attempt was stopped by her accountant before they were able to go through to the IRS, police said.

Dobbs Ferry police agreed that there does seem to be an upward trend in this specific strategy of committing tax fraud, which may be attributed to the increase in taxpayers submitting electronically.

Dianne Besunder, a spokeswoman for the IRS, said she couldn't comment on whether electronic filing was fueling this type of fraud, but she did say that scammers were getting more adept at obtaining people's identities and preying on those who put themselves at greater risk, such as leaving a wallet or personal information in public spaces unattended. 

According to Besunder and IRS statistics, "Last year we identified nearly 262,000 returns that were linked to identity theft and we stopped more than $1.4 billion dollars in fraudulent refunds related to identity theft from being issued."

There was a Senate Finance Committee hearing held recently on this issue. 

“This unprecedented effort against identity theft sends a strong, unmistakable message to anyone considering participating in a refund fraud scheme this tax season,” said IRS Commissioner Doug Shulman. “We are aggressively pursuing cases across the nation with the Justice Department, and people will be going to jail. This is part of a much wider effort underway at the IRS to help protect taxpayers.”

“The Justice Department is working closely with the IRS to investigate, prosecute, and punish tax refund crimes committed through the theft of identities,” said Principal Deputy Assistant Attorney General John A. DiCicco of the Tax Division. “Now, more than ever, we must remain vigilant against the unauthorized use of identification information to defraud the U.S. government.”

The IRS works in conjunction with the New York State Department of Taxation and Finance to identify and address tax fraud.

"We believe this type of tax fraud has increased this year and last," said Ed Walsh, a spokesman for the New York State Department of Taxation and Finance. "Somehow criminals are finding more effective ways to obtain people's Social Security Numbers and file tax returns in their names."

This all sounds counter-intuitive, right? Why would someone want to file your taxes?

"I think it's a combination of criminals targeting people whom they know are entitled to refunds—especially people who work for companies and have their taxes withheld throughout the year—and bloating tax returns to make it seem as if an arbitrary taxpayers were entitled to receive money back."

He disagrees that e-filing is the cause of the upward trend in this type of fraud."I think it's more that most people file their taxes electronically now (90 percent), so that you're bound to see more fraud in these instances."

Walsh thinks the scammers are just getting savvier. 

However, he said that the state has a "checks and balances" system to try to identify fraud, which is cutting-edge compared to most states.

"We have what's called a 'Case ID' system,' in which we run through all returns in which people are requesting refunds. Then, the ones that are deemed questionable are further investigated by aligning the forms with the person's employment information."

"We catch a lot of fraud this way," he said.

To protect yourself from this type of ID theft, Walsh recommended that it's always prudent to shred papers with your Social Security Number and to avoid carrying your Social Security card in your wallet—lest you leave it behind at the grocery store or in a restaurant etc. 

Those who believe they have been victimized by tax-related ID theft, should submit an ID theft affidavit here (Form 14039) as well as contacting local police. 


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