

Even IRS employees themselves aren’t immune to stealing the numbers. While these entities themselves aren’t likely to start stealing tax refunds, in many cases dishonest employees can steal social security numbers and sell them at illegal websites. The list of services and companies that ask for the numbers include hospitals, credit card companies, banks and tax prep services like TurboTax. Dozens of legitimate businesses and organizations require customers and participants to divulge social security numbers as a matter of course. How easy is it for thieves to get your name and social security number? Very. The victims often have a very difficult time proving their identity to the IRS. The results can be devastating for the victims, resulting in mammoth hassles, paperwork, lost hours on the phone and tax refunds that get held up for months or even years. Names and social security numbers are the only method the IRS uses to check the identity of most taxpayers. Since the IRS accepts tax returns starting in February and many taxpayers don’t file until April, the thieves can simply fill out a fake tax return in the meantime using the victim’s name and social security number and the IRS will send them a check. All a criminal needs is an unsuspecting taxpayer’s name and social security number.

Tax refund theft is so popular with thieves because it’s so easy. The crime has become so popular and easy that inner city police departments have reported that drug dealers and other organized criminals who once relied on violent crime are switching to it to make a living. By 2016 it’s expected to hit $21 billion.

Incidents of the crime went up 66% from 2012 to 2013, resulting in more than $5 billion in stolen tax refunds. Tax refund theft is the IRS’s #1 scam for 2014, victimizing millions of Americans. Tax refund theft stole $5 billion in 2013 and is expected to hit $21 billion in 2016.
