Patterico's Pontifications

6/30/2013

Would the IRS Let YOU Get Away with Fraud? The Answer Might Surprise You!

Filed under: General — Patterico @ 12:42 pm

Thr answer is: why, sure! . . . if you’re an illegal immigrant, that is:

Howard is a tax examiner at the IRS’s ITIN processing center in Austin, Texas.

The large, unmarked building in south Austin is where the IRS decides whether to issue an Individual Taxpayer Identification Number to the millions of illegal immigrants who apply for them. An ITIN allows undocumented workers to file tax returns and pay taxes, a legal requirement for those who earn income in the United States … even those who come to the country illegally.

But 13 Investigates discovered the ITIN system is plagued by abuse and fraud.

. . . .

“We were being told by upper management to ignore fraud, to assign ITIN numbers and … pay out refunds to people who are lying,” Howard explained. “It’s a license to steal when you allow that.”

Howard and five other tax examiners at the ITIN processing center in Austin all told WTHR the same thing: for years, IRS managers have instructed them to “look the other way” while processing ITIN applications that appear to be filed fraudulently – even when those applications contain clear signs of criminal activity.

For example, Howard received a stack of ITIN applications for dozens of children attending the same school in South Carolina. (Adult tax filers can request an ITIN for a child if they want to claim that child as a dependent in order to get child tax credits and a larger tax refund.) When he researched that school, he discovered it didn’t even exist. When Howard reported the apparent scam to his bosses, he claims his managers ordered him to approve the applications anyway.

The matter is now being examined by the Inspector General.

UPDATE: The linked story is a year old, but there is a report in the Austin American Statesman today concerning the Inspector General’s investigation. Problem is, the current article is behind a paywall, so it’s impossible for nonsubscribers to tell exactly what is going on today.

It’s clear that the IRS has not seen the end of scandal. Not even close.

47 Responses to “Would the IRS Let YOU Get Away with Fraud? The Answer Might Surprise You!”

  1. i just found out the california ftb penalizes you for paying your quarterlies early

    maybe that’s something the fascist piggies at the Consumer Financial Protection Bureau could look into

    happyfeet (c60db2)

  2. Commander Issa will get to the bottom of this…

    mg (31009b)

  3. You don’t have to be an illegal immigrant to get an ITIN number.

    You just have to pretend to be.

    Because the Social Security number of every person mentioned on a tax return must be given, this is the only way left now to create an imaginary person.

    They used to use dead people, but that loophole has been closed. They use elderly people in Florida but that requires obtaining a number. That’s becming a big thing too. They file tax returns choos ethe option of getting a debut card and have it mailed to a mail drop, which might be a abandoned development where a mailbox has been erected.

    There is fraud by illegal aliens but that mostly consists of claiming to be supporting nephews and nieces in Mexico. (Mexico and Canada are the only two foreign countries child dependents can reside and still be claimed)

    Claims that they have dependents are mostly unaudited. And they do not or would not have Social Security numbers.

    Sammy Finkelman (6f9f42)

  4. What the new bill does is say people petitioning must pay their taxes but that seems like it is ten years from now. So nobody will have to pay taxes for before the bill passes 9which is impossible)

    Sammy Finkelman (6f9f42)

  5. SF the bill does not say that. It merely says that you must be current with the IRS and pay any back taxes already assessed. In other words, if you have never filed you don’t owe. One of the many things about this bill that we have been lied to about.

    Gazzer (778001)

  6. The IRS might as well just be called the Democrat Party Incentives Service. Carrot and stick.

    I’m sure it is well understood that if democrats run things, many troughs stay full. USDA settlement, tax fraud, obamaphones, food stamps, whatever you want. Just scratch the DNC’s back and they will scratch yours, courtesy the children and grandchildren of all parties involved. It takes quite a bit of moral nihilism to make that work, so a tip of the hat to American media is warranted.

    Dustin (8b7882)

  7. WRT all these things being “investigated” by the IG, I see a lot of chips flying but I don’t see too many trees falling.

    When are we actually going to see some heads roll?

    crosspatch (b4f34e)

  8. UPDATE: The linked story is a year old, but there is a report in the Austin American Statesman today concerning the Inspector General’s investigation. Problem is, the current article is behind a paywall, so it’s impossible for nonsubscribers to tell exactly what is going on today.

    It’s clear that the IRS has not seen the end of scandal. Not even close.

    Patterico (5a517e)

  9. Shee-yut! How come I never got in on any of this sugar?

    Average Taxpaying American (be0117)

  10. The article may be old but the fraud continues. I just read somewhere where the IRS paid 88 returns to one address!

    Patricia (be0117)

  11. That this was reported a while ago makes the story worse, unless there’s some sign the IRS has made a dramatic reform.

    I think they were too busy making sure no one organized any government reform groups to worry about the US Treasury being raided. That check I had to pay because my deduction was a little short is kinda irking me. I guess I know where that money went. That’s a whole lot of big league chew I’m missing out on.

    Dustin (8b7882)

  12. I recall speaking with an accountant last year and she told me that in her dealings with the IRS through the years she has encountered more than her fair share of discrepancies, arrogance and flat-out dishonesty on their part.

    I also remember reading about how some of the most socialized, leftwing-ized, pro-big-government societies in the world have a good portion of their populace being nonchalantly underhanded and tricky towards their tax agencies.

    By contrast, I read a survey earlier this year that reported a large percentage of Americans express a prim and proper attitude towards the IRS and are wary about people finagling with their taxes.

    Quaint.

    Mark (67e579)

  13. I want in. Is there a guide somewhere to how to do this?

    Diffus (4a5ca6)

  14. crosspatch @1:50: Thanks to recent and current events, my cynicism meter is pegged such that the only answer to your question is, “either all of them roll or none of them will, ever.”

    PCachu (e072b7)

  15. The matter is now being examined by the Inspector General.

    I suspect that even if the IG mentions any of this in a report, no one involved with the fraud perpetration is going to be fired or prosecuted.

    Blacque Jacques Shellacque (bed55d)

  16. “The IRS sent more than $46 million in tax refunds to 23,994 “unauthorized” alien workers who all listed the same address in Atlanta, Ga., in 2011, according to an audit report by the Treasury Inspector General for Tax Administration (TIGTA).

    However, the Atlanta address that received millions of dollars in refunds was not the only address apparently housing thousands of “unauthorized” aliens. In fact, it wasn’t even the only address in Atlanta that was claiming such a situation.

    The TIGTA audit report, published last year at the request of members of Congress, revealed 10 addresses in the U.S. that were issued anywhere from 1,846 to 23,994 tax refunds each. Four of those 10 addresses were located in Atlanta.”

    Read the full story at:
    http://www.theblaze.com/stories/2013/06/21/irs-sent-46-million-in-tax-refunds-to-23994-unauthorized-aliens-all-at-the-same-address-in-atlanta/

    Bet the IRS data guys and auditors all got bonuses and/or promotions for doing a swell job for taxpayers.

    in_awe (7c859a)

  17. My usual comment: if the government collection of personal data is allegedly to ferret out such blatantly obvious tax cheats as described by in_awe, why is this still happening?

    Cripes, you’re not even catching actual, blatant criminal acts that could be caught by any reasonably functional computer programme.

    bridget (84c06f)

  18. Bridget, they’re not collecting all this personal data so they can ferret out the criminals and go after them.

    It’s much easier to go after you. Criminals are dangerous. They need all the money they can squeeze out of you to pay the criminals off.

    http://www.chicagomag.com/Chicago-Magazine/January-2012/Gangs-and-Politicians-An-Unholy-Alliance/

    This Second City comedy club production is now going nationwide.

    Steve57 (ab2b34)

  19. But they’ll hand OBAMACARE just fine.

    Gus (694db4)

  20. Similar level of category error;

    http://stream.aljazeera.com/story/201306242119-0022853

    narciso (3fec35)

  21. We’ve come to a point (Romney pointed it out), that half of Americans’don’t care about fraud. They are recipients, and only MILLLLIONAIRES and BILLLIONAIRES are supposedly being RAPED. Yet we are 17 TRILLION in debt, and each and every one of the LIBTARDS/OBAMA’S schemes promise us that they will REDUCE THE DEBT.
    Obama is doing this on purpose. It’s short term. The nation implodes, he blames CAPITALISM, and then the WAR starts. Be armed. Be ready.

    Gus (694db4)

  22. This is about four years old but it provides some background on the criminals that Rubio and McCain want to cozy up to. It doesn’t discuss how the IRS never investigates obvious fraud by ITIN holders but related crimes. Including how the IRS and the SSA have facilitated identity theft crimes against US citizens.

    http://www.cis.org/IdentityTheft

    Illegal, but Not Undocumented
    Identity Theft, Document Fraud, and Illegal Employment

    In a nutshell, if an illegal alien using a stolen SSN is among the tens of thousands using one of those 10 addresses cited in in_awe’s comment, the IRS sends the refund or tax credit check to that address made out to the illegal by name.

    If an illegal alien using a stolen SSN doesn’t pay taxes, the IRS goes after the legitimate SSN holder and not the illegal. The IRS never tells the individual that they’ve been a victim of identity theft even though they know they have, and they never inform law enforcement of the fraud.

    If you were an illegal alien in this country would you even want to become a US citizen? I hear Rubio talk about how tough his bill is. “No benefits. No Obamacare.”

    Excuse me? Aren’t Republicans supposed to be against Obamacare because it’s a trainwreck? And Rubio says it’s a selling point that Obamacare is being denied to illegals? I couldn’t wait to upgrade my legal status to illegal if that were possible.

    Steve57 (ab2b34)

  23. Rube e o. The boy got rolled by Schumer and Durbin, Madame Graham and Mumbles McCain willingly went along with their “honorable” friends from the other side of the aisle.
    Why pass any bill UNTIL the illegals have made their payments and paid the price? The answer is that these DIMBULBS believe they are on the wrong side “politically” not morally, nor vis a vis the needs of the UNITED STATES.

    Gus (694db4)

  24. This could be fun.

    1) Get 5 of these ITIN thingies under different names.

    2) Get 5 part-time jobs in your profession. Make maybe $20K at each of them, then file 5 returns, claiming a earned income credit on each.

    3) Profit!

    Kevin M (bf8ad7)

  25. If you want to be really depressed, get Dan Simmons’ Flashback, a novel set 30 years onward in the ruined America of Obama’s legacy. Simmons has won a couple of Hugos, although this book hasn’t made him any friends.

    Kevin M (bf8ad7)

  26. It does seem that since they seem to be so incompetent at doing what they should be doing with legitimate information, that the gathering of extra information is just to have on hand to smack down any troublemakers, i.e. people who have a spine and stand up and say unpopular things.

    The assumed legitimacy of government function of my childhood has been greatly eroded.

    MD in Philly (3d3f72)

  27. people who have a spine and stand up and say unpopular things

    you’re kind of an unlikely cheerleader for people what say unpopular things have you had one of them eppy funny things?

    happyfeet (8ce051)

  28. Gus (23): You got that right, Madame and Mummbles. If you went through the list of patriots in 1776, you would not find their equal. Or, to be more correct, you would not find their equal on the American side. And I just got an appeal from the Republican Senate operation begging for money so they could attain a 51 vote majority. By my count, they are 19 away from that magical majority. I’m afraid my meager contribution, even when matched 3 to 1 by Senator Thune, will not make much of dent in their goal if they are being realistic.

    bobathome (72a652)

  29. feets, you should know that I say all kinds of unpopular things like other lifedoodle pro-old fashioned marriage hater bigots that Justice Kennedy talks about.

    MD in Philly (3d3f72)

  30. i’m rooting for you even though admittedly I disagree with you on some of the particulars

    did you not read Mr. Hugh’s piece on Kennedy’s opinion?

    happyfeet (8ce051)

  31. Except it never works that way re Prop 187, SB 1070,
    there can never be any circumscribing of the liberal agenda in any state, for any period of time,

    narciso (3fec35)

  32. Does anyone else find it interesting that during this time of “debate” about illegal immigration by the world’s most highly regarded deliberative body (copyright 1936) that the MSM failed to carry a single story about the rampant tax fraud involving illegals? They carried the claims that “solving” the “immigration crisis” will yield billions in net revenue to the federal government. But they failed to publicly note that the fees and back taxes and penalties supposedly to be paid by the illegals can all be waived en mass upon a finding of potential “hardship” should they be enforced?

    in_awe (7c859a)

  33. So . . . WHAT part of this story is supposed to ‘surprise’ me?

    Icy (695237)

  34. Greetings:

    Mr. Howard is wrong. It’s not a “license to steal”. It’s wealth redistribution.

    11B40 (58e67e)

  35. “Get Dan Simmons’ Flashback, a novel set 30 years onward in the ruined America of Obama’s legacy.”

    – Kevin M

    I bet that shopping malls make announcements in both English and Spanish!

    Leviticus (b98400)

  36. Leviticus – We will have segregated shopping malls because of the divisive racial rhetoric of Obama and his crowd.

    daleyrocks (bf33e9)

  37. R.I.P. Jim Kelly, African-American martial artist that fought Bruce Lee in “Enter The Dragon”

    Icy (695237)

  38. Leviticus,

    Are you as tired as I am of hearing, “Press 1 for English, and para espanol oprima dos (for Spanish press two).

    peedoffamerican (ee1de0)

  39. Next thing is gonna be, 中国按3 (for Chinese press 3)

    peedoffamerican (ee1de0)

  40. Comment by Sammy Finkelman (6f9f42) — 6/30/2013 @ 1:30 pm

    “What the new bill does is say people petitioning must pay their taxes but that seems like it is ten years from now. So nobody will have to pay taxes for before the bill passes (which is impossible)

    Comment by Sammy Finkelman (6f9f42) — 6/30/2013 @ 1:30 pm

    5. Comment by Gazzer (778001) — 6/30/2013 @ 1:39 pm

    SF the bill does not say that. It merely says that you must be current with the IRS and pay any back taxes already assessed. In other words, if you have never filed you don’t owe. One of the many things about this bill that we have been lied to about.

    No, that’s more or less what I thought when I read that this applies ten years from now. A person would need to be current 10 years from now, and (in most cases) would have to claim employment, which means they have to claim income and file taxes.

    There are already people filing taxes in hopes that will help them become legal.

    The idea is they will file taxes, even if they are not doing so now, as soon as they get a Social Security number.

    Sammy Finkelman (d22d64)

  41. 24. Comment by Kevin M (bf8ad7) — 6/30/2013 @ 7:10 pm

    This could be fun.

    1) Get 5 of these ITIN thingies under different names.

    2) Get 5 part-time jobs in your profession. Make maybe $20K at each of them, then file 5 returns, claiming a earned income credit on each.

    3) Profit!

    No, people who use an ITIN cannot claim the Earned Income Tax Credit. But they can claim everything else.

    What you would need to do is invent imaginary nephews, nieces, children and and stepchildren in Mexico or Canada and claim personal exemptions.

    Sammy Finkelman (d22d64)

  42. Comment by bridget (84c06f) — 6/30/2013 @ 5:39 pm

    if the government collection of personal data is allegedly to ferret out such blatantly obvious tax cheats as described by in_awe, why is this still happening?

    You see, these people (real or imaginary) would not be in the data system. That’s why they are called “undocumented”

    Cripes, you’re not even catching actual, blatant criminal acts that could be caught by any reasonably functional computer programme.

    Somebody would have to realize the problem and write the software. Government is not good at correcting errors.

    Sammy Finkelman (d22d64)

  43. The software (or complaints) does catch this thing, but only after millions of dollars have been sent as refunds.

    Two men accused of using tax-preparing business for massive refund thefts One man bragged of cashing more than $29 million in fraudulent checks, undercover agents said

    “Dorlizier indicated that some of the people whose names appear on the income tax checks are unaware that income tax returns were filed in their names. Dorlizier also stated that he files tax returns for clients who ‘don’t work for real,'” agents wrote.

    That’s the other system. Find the Social security numbers of people in nursing homes, or in condominiums who don’t file a return and have the refund put on a debit card and mailed to a mail drop, which might be an abandoned housing development where you erect a mailbox.

    Sammy Finkelman (d22d64)

  44. Jimmy Rodefer: Don’t become a victim of tax identity theft (Knoxvillebiz.com

    You can now count tax identity theft among our world’s ever-growing personal security concerns. The IRS on its website has a lengthy section reporting legal actions resulting from tax identity theft. Here are two examples straight from its website:

    They need real Social Security numbers for the Earned Income tax credit.

    Sammy Finkelman (d22d64)

  45. Feds: University Mall business boom was tax fraud

    This is a case where the government wants to seize money made by selling things to people using tax reform debit carts on the grounds they had to know what this really was. He had stopped accepting them and then started again and switched processors because it was being rejected.

    Sammy Finkelman (d22d64)


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