Unit to assist income tax fraud victims in Pa.
HARRISBURG — The state Department of Revenue is establishing a unit to help victims of income tax fraud and identity theft, crimes it says are on the rise in Pennsylvania.
The department said the number of tax returns it flagged as potentially fraudulent increased 46 percent this year from last.
The unit will zero in on victims whose stolen identity is used to claim their tax refund.
Revenue Secretary Eileen McNulty said the goal is to “resolve fraudulent returns as soon as possible and protect tax dollars for all Pennsylvanians.”
Kevin Hensil, spokesman for the department, said the spike is thought to have a two-pronged explanation: a bolstered filtering system used in audits, and that identity thieves are increasingly trying to steal tax returns.
“Scammers are looking for increasingly sophisticated ways to steal identities and claim a fraudulent refund,” McNulty said.
Tax returns considered suspect jumped by 8,500 — to 27,000 — this tax season the agency said.
The department will shuffle eight employees to man the Personal Income Tax Fraud Investigation Unit. Those tasked with sifting through taxpayer complaints will, however, retain some of their prior responsibilities, Hensil said.
He said the goal of restructuring is to provide taxpayers a “single point of contact” to address their concerns and reports of identity theft.
The reassigned employees will be focused on hastening the process of restoring victims’ identities and straightening out financial mishaps, an undertaking that many find to be inefficient.
He noted the growing concern nationwide among taxpayers in response to tax refund fraud. “We’re becoming a lot more aware of the problem and trying to deal with it.”
U.S. Sen. Bob Casey, D-Scranton, is a ranking member of the Senate Subcommittee on Taxation and IRS Oversight who has made tax fraud via identity theft one of his causes in Washington for years.
In 2014, he met with Berks County District Attorney John Adams to hear testimony from residents who have been victimized by what Adams considers a major problem in his jurisdiction.
Casey called the issue a “substantial problem,” citing the 172,000 Pennsylvanians victimized by tax-related identity theft in 2014.
“Any steps that can be taken to ease the burden of taxpayers who have been victims of tax related identity theft, while maintaining sufficient security protocols, is welcome,” Casey said. “It is important for federal, state and local governments to work together to combat this increasingly pervasive threat.”
On Friday, Adams said the creation of a unit focused on alleviating victims’ problems is a “good idea.”
“Clearly, we have absolutely had a problem,” he said. “So any unit that can focus on this problem and combat it is long overdue.”
Adams said that the IRS track record of responding to reports of income tax fraud is “generally standoffish.” He said the national agency “has not been diligent, (they) haven’t investigated every complaint. They’ve been complacent.”
If someone suspects they have been the victim of identity theft or income tax fraud, they may contact the investigative at 717-772-9297 or [email protected].
Colt Shaw is an intern in Harrisburg with the Pennsylvania Legislative Correspondents Association.