Taxpayer Advocate Service: Your Voice at the IRS

National Taxpayer Advocate Annual Report to Congress

IRS BURDENS ID THEFT VICTIMS

THE IRS FAILS TO HELP HUNDREDS OF THOUSANDS OF IDENTITY THEFT VICTIMS

Tax-related identity theft wreaks havoc on the lives of its many victims, who not only must cope with an emotionally exhausting crime, but may have to deal with the IRS for years to untangle their account problems.

Identity theft cases in the IRS and the Taxpayer Advocate Service are rising at an alarming pace. The IRS has nearly 650,000 such cases in its servicewide inventory, and may take six months or longer to resolve them. TAS’s identity theft caseload has soared more than 650% since fiscal year 2008, with TAS providing relief to 88 percent of the affected taxpayers in FY 2012.

While the IRS has adopted some of the National Taxpayer Advocate’s repeated suggestions for resolving the problem, it has not done enough to relieve the victims’ burden. A particular concern is the IRS’s effort to decentralize its approach to helping victims. The National Taxpayer Advocate firmly believes the IRS needs a single, central “traffic cop” unit to handle complex identity theft cases with multiple issues.

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Identity theft wreaks havoc on our tax system in many ways. The impact on victims is significant. More than 75 percent of taxpayers filing returns are due refunds, which average some $3,000 and are not paid until the IRS fully resolves a case. That now takes more than 6 months.

- Nina Olson, National Taxpayer Advocate

Other Most Serious Problems