Reason.com - Free Minds and Free Markets
Reason logo Reason logo
  • Latest
  • Magazine
    • Current Issue
    • Archives
    • Subscribe
    • Crossword
  • Video
  • Podcasts
    • All Shows
    • The Reason Roundtable
    • The Reason Interview With Nick Gillespie
    • The Soho Forum Debates
    • Just Asking Questions
    • The Best of Reason Magazine
    • Why We Can't Have Nice Things
  • Volokh
  • Newsletters
  • Donate
    • Donate Online
    • Donate Crypto
    • Ways To Give To Reason Foundation
    • Torchbearer Society
    • Planned Giving
  • Subscribe
    • Reason Plus Subscription
    • Print Subscription
    • Gift Subscriptions
    • Subscriber Support

Login Form

Create new account
Forgot password

Policy

Government at Work: Handing Out Billions in Tax Refunds to Con Artists

J.D. Tuccille | 11.11.2013 10:03 AM

Share on FacebookShare on XShare on RedditShare by emailPrint friendly versionCopy page URL
Media Contact & Reprint Requests

Here's the good new: the Internal Revenue Service believes it's not handing out quite so many billions of dollars to identity thieves as it used to. Yay, IRS. Your government at work: hectoring you about your supposed obligation (and even delight!) to cough up the goods to Uncle Sam while handing out free money to con artists. And the feds are still doing their best to prove that crime does pay. The U.S. Treasury Inspector General for Tax Administration says the latest figures have the IRS paying out $3.6 billion in bogus tax refunds in 2011.

According to the breezily titled, Detection Has Improved; However, Identity Theft Continues to Result in Billions of Dollars in Potentially Fraudulent Tax Refunds (PDF), dated September 20 but published online November 7:

Our analysis of Tax Year 2011 tax returns identified approximately 1.1 million undetected tax returns filed using SSNs that have the same characteristics of IRS-confirmed identity theft tax returns. Potentially fraudulent tax refunds issued total approximately $3.6 billion.

As mentioned, this is an improvement, since TIGTA fingered $5.2 billion in fraudulent returns for 2010.

As the title suggests, the report touts the IRS's ever-improving efforts to detect fraud and not dole out cash to scammers. The key to a more honest world, we're told, is "[a]ccess to third-party income and withholding information." That's right, if we'd just cough up more data to Uncle Sugar, he'd stop handing checks to anybody who asked. We have nobody to blame for the IRS's missteps but ourselves and our stubborn insistence on not living in glass boxes.

Tax fraud
TIGTA

When the IRS processes fraudulent returns and mails out checks, it doesn't just piss money away, it also delays the processing of legitimate returns by taxpayers whose Social Security Numbers were appropriated by the con artists. Well, the live ones, anyway. The thousands who were dead and buried before returns we submitted in their names probably don't care. In fact, though, most of the fraudulent tax returns were submitted using the data of people who don't actually have to file. In addition to those who are pushing up daisies, that is.

The Rattler is a weekly newsletter from J.D. Tuccille. If you care about government overreach and tangible threats to everyday liberty, this is for you.

This field is for validation purposes and should be left unchanged.

NEXT: The Deadline For Reason's Spring Internship is This Wednesday

J.D. Tuccille is a contributing editor at Reason.

PolicyIRSTaxesCrime
Share on FacebookShare on XShare on RedditShare by emailPrint friendly versionCopy page URL
Media Contact & Reprint Requests

Show Comments (12)

Latest

Does Drug Use Lead to Addiction, or Are Some Brains More Prone To Use Drugs?

Ronald Bailey | From the July 2025 issue

An Empty Pool in Peru Is a Monument to the Drawbacks of Historic Preservation

Bekah Congdon | From the July 2025 issue

Trump Shreds the Constitution By Bombing Iran

Matthew Petti | 6.21.2025 11:04 PM

Quebec's Dairy Farmers Are Blocking Free Trade in Canada

Stuart J. Smyth | 6.21.2025 7:00 AM

The Criminal Justice System Was Found Guilty in the Karen Read Trial

Billy Binion | 6.21.2025 6:30 AM

Recommended

  • About
  • Browse Topics
  • Events
  • Staff
  • Jobs
  • Donate
  • Advertise
  • Subscribe
  • Contact
  • Media
  • Shop
  • Amazon
Reason Facebook@reason on XReason InstagramReason TikTokReason YoutubeApple PodcastsReason on FlipboardReason RSS

© 2024 Reason Foundation | Accessibility | Privacy Policy | Terms Of Use

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

r

Do you care about free minds and free markets? Sign up to get the biggest stories from Reason in your inbox every afternoon.

This field is for validation purposes and should be left unchanged.

This modal will close in 10

Reason Plus

Special Offer!

  • Full digital edition access
  • No ads
  • Commenting privileges

Just $25 per year

Join Today!