Treasury Inspector General for Tax Administration releases report saying IRS missed millions in fraudulent claims

The Treasury Inspector General for Tax Administration has released a report that requires the IRS to find a better way at identifying fraudulent tax returns.

Fraudulent refunds have been identified with returns filed by nonresident workers in the U.S. or U.S. territories that seem to be targeted by identity thieves.

According to Accounting Today, people that are residents of a U.S. territory typically file taxes in their territory, and haven’t claimed taxes they’re entitled to like the Earned Income Tax Credit or the Child Tax Credit.




Identity thieves are claiming these credits from prisoners or nonresident workers, and the IRS is simply not built to catch these things right now. They’re still overburdened from the last tax year.

873,009 international tax returns were filed in 2018 and many were fraudulent.

The report shows that people received $83.7 million in tax credits that they were not entitled to.

The report said the IRS can improve their attempts at flagging potentially fraudulent returns by requiring more documentation for certain claims.

The IRS has agreed to 12 of the 15 recommendations.

The report can be read fully here.


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