Tax Refund Fraud In The Quad Cities - News and Weather For The Quad Cities -

Tax Refund Fraud In The Quad Cities

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We're nearing the end of tax season and local tax preparers are working at a frenzied pace.

However, not every taxpayer owed a refund will get theirs.

Tax refund theft is one of the fastest growing crimes in the U.S.

The Quad Cities is not immune to the trend either.

Calling around to local tax preparers and accountants it's clear that some people in the area find out their identity has been stolen only when their tax return gets rejected.

Delaying their ability to get a refund, and in some cases, having to fight penalties assessed by the IRS incorrectly.

The tax preparers say it's unclear how the criminals are getting this personal information, but once they have it, their victim's refund is headed to the bank.

"I know in the death, they're having more and more of those, so I'm not sure, because basically if you get their social security number, you get their birth date and their name, you've got it," says tax consultant Karen Freeman.

She's has been sorting out her client's 1040's and W-2's for 38 years. She says tax returns get rejected from time to time if her clients mistakenly claim the wrong social security number. However, she says more rejected returns are turning into fraud cases.

"A lady's son got killed here in Davenport, and somebody stole his identity, she went to file the tax return and it was rejected, somebody else has filed it, she said there was nobody else."

Freeman says each year brings another two or three of her clients into this roadblock. The fix is relatively simple now, just file another form to the IRS.

"Send you a protection identity pin number, and then that's what you use every time," says Freeman.

So far though, there is no good way to prevent getting a refund stolen in the first place. The IRS has told Congress it's researching new ways to flag fraudulent claims. Freeman says a big issue is some of the forms. Not every return requires a W-2. So she advises her affected clients to do even more on their own.

"Issuing these numbers are really good, that way these people can continue but I always tell my clients after that, start running your credit reports and checking out your items," says Freeman.

Keeping their returns clear from another bogus set of claims.

The IRS is beefing up it's fraud investigation unit because of the growth of these false refund claims.

It also allows taxpayers to file for the personal id number if someone suspects they're a victim of identity theft, even if they have not yet filed a tax return.