{"database": "press", "table": "releases", "rows": [["https://web.archive.org/web/20140115013001/http://www.billnelson.senate.gov:80/news/details.cfm?id=348013&", "In wake of new reports, Nelson renews push for legislation targeting tax refund identity scams", "2013-11-07", "2013", "2013-11", "Democrat", "House", "FL", "Bill Nelson", "N000032", "web.archive.org", null, null, "legacy", "In wake of new reports, Nelson renews push for legislation targeting tax refund identity scams                                                                                                                                                                                                                                                                                                                                                                                                                       \n\t\t\t\t\n\t\t\t\tNovember 7, 2013\n\t\t\t\t\n                \n\t\t\t\t  \tWASHINGTON, D.C. - U.S. Sen. Bill Nelson (D-FL) is renewing his call for an increased government crackdown on identity thieves who use someone else\u2019s name to steal their tax refunds. \u00a0 Nelson\u2019s latest push comes in the wake of two new reports due out today by the U.S. Treasury Department\u2019s inspector general on identity theft-related tax fraud. \u00a0 The reports show the government is still losing $3.6 billion a year in potentially fraudulent tax refunds and it\u2019s taking over 300 days for consumers who\u2019ve had their identities stolen to get their cases resolved. That\u2019s down from the $5.2 billion in potentially fraudulent refunds that were issued in 2011. \u201cWhile these reports show that some progress is being made in reducing tax fraud, it\u2019s also clear that there is still much to be done,\u201d Nelson said in a letter to the Sen. Max Baucus (D-MT), chairman of the Senate Finance Committee. Nelson requested the two newly-released inspector general reports after law enforcement authorities in Florida contacted him about seeing an increase in the number of cases in Florida where people were having their identities stolen. In 2011, a crackdown by a Tampa task force uncovered as much as $130 million in fraudulent refunds and officials made 49 arrests. \u00a0 Nelson re-filed his legislation (S. 676) in April that would toughen criminal penalties for ID thieves who file fake refunds under someone else\u2019s name.\u00a0 It would also require the IRS to get legitimate taxpayers the refunds they\u2019re due within 90 days.\u00a0 Right now, according to these newly-released reports, it\u2019s taking the IRS an average of 312 days to close identity theft cases. \u00a0 \u201cEarlier this year, I introduced legislation which I believe would go a long way to solving many of the problems identified in these latest reports,\u201d Nelson wrote to the committee chair.\u00a0 \u201cTherefore, I request that you prioritize moving my legislation through the Finance Committee before another tax filing season passes and we have even more victims of tax-related identity theft.\u201d A similar version of Nelson\u2019s bill stalled in the Senate last year.\u00a0 The legislation he re-filed earlier this year is currently pending before the Senate\u2019s Finance Committee. \u00a0 Here are the links to view the two Treasury IG reports: \u00a0 Click Here to download the report titled: \"Case Processing Delays And Tax Account Errors Increased Hardship For Victims Of Identity Theft\" Click Here to download the report titled \"Detection Has Improved; However, Identity Theft Continues to Result in Billions of Dollars in Potentially Fraudulent Tax Refunds\"\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 \u00a0 And here\u2019s a copy of Nelson\u2019s letter to Sen. Max Baucus, chairman of the Senate Finance Committee, followed by a summary of Nelson\u2019s legislation: November 7, 2013    \t\u00a0    \t\u00a0    \tThe Honorable Max Baucus    \tChairman    \tSenate Committee on Finance    \t219 Dirksen Senate Office Building    \tWashington, D.C. 20510    \t\u00a0    \tDear Chairman Baucus:    \t\u00a0    \tI am writing about two reports that the U.S. Treasury Department\u2019s inspector general released today on identity theft-related tax fraud.    \t\u00a0    \tWhile these reports show that some progress is being made in reducing tax fraud, it\u2019s also clear that there is still much to be done and there are still a number of improvements that need to be made to protect both taxpayers and the U.S. Treasury.    \t\u00a0    \tLast year, the IRS issued $3.6 billion in potentially fraudulent tax refunds, and criminals are still able to use the identities of deceased Americans to steal millions of dollars each year. Meanwhile, taxpayers whose identities have been stolen have to wait 312 days on average to have their cases resolved.    \t\u00a0    \tEarlier this year, I introduced legislation - the Identity Theft and Tax Fraud Prevention Act (S. 676) - which I believe would go a long way towards solving many of the problems identified in these latest reports.\u00a0 Therefore, I request that you prioritize moving my legislation through the Finance Committee before another tax filing season passes and we have even more victims of tax-related identity theft.    \t\u00a0    \tThank you for your consideration. Sincerely, Bill Nelson    \t\u00a0\u00a0\u00a0\u00a0\u00a0 \u00a0 IDENTITY THEFT AND TAX FRAUD PREVENTION ACT OF 2013 TITLE 1:\u00a0 PROTECTING VICTIMS OF TAX-RELATED IDENTITY THEFT Section 101.\u00a0 Expedited refunds for identity theft victims.\u00a0 In 2012, the average time necessary for the IRS to close identity theft cases was 196 days.\u00a0 According to the Taxpayer Advocate, the amount of time needed to resolve a case can be cut in half if the IRS adopts appropriate administrative reforms.\u00a0 The bill directs the Secretary to establish a plan of action for resolving and closing identity theft cases within 90 days. Section 102.\u00a0 Single point of contact for identity theft victims.\u00a0 Victims of tax-related identity theft express frustration with the need to repeatedly contact the IRS regarding their case and having to explain their situation to a different IRS employee, who has no knowledge of the matter, each time they call.\u00a0 The bill directs the Secretary to ensure that an identity theft victim has a single point of contact at the IRS that tracks the case from start to finish. Section 103.\u00a0 Enhancements to IRS PIN Program.\u00a0 The IRS anticipates issuing over 600,000 personal identification numbers (PINs) to identity theft victims in 2013.\u00a0 However, the PIN program still fails to protect all victims whose identities have been compromised because PINs are not issued until all tax account issues have been resolved.\u00a0 The bill directs the IRS: (1) to expand the existing PIN program to provide victims with a PIN earlier in the review process, and (2) to issue a report to Congress on the effectiveness of PIN program. Section 104.\u00a0 Electronic filing opt out.\u00a0 More than 80 percent tax-related identity theft occurs through electronically filed tax returns.\u00a0 The IRS does not permit identity theft victims to \u201cturn off\u201d electronic filing. The bill would allow an individual filing an identity theft affidavit to direct the IRS not to process federal tax returns submitted electronically by persons purporting to be the taxpayer. TITLE 2:\u00a0 SHUTTING DOWN ABUSIVE IDENTITY THEFT AND TAX FRAUD SCHEMES Section 201.\u00a0 Restrictions on ability to use prepaid cards for tax fraud.\u00a0 A common identity theft scheme involves the purchase of a reloadable prepaid debit card using a stolen identity.\u00a0 The criminal then files a tax return using the stolen identity and has the fraudulent refund transferred to the prepaid card through a direct deposit.\u00a0 The bill directs financial regulators to issue new rules to make the account numbers associated with prepaid debit cards and other vulnerable accounts distinguishable from those in which the issuer verifies the identity of the accountholder through more rigorous customer identification procedures.\u00a0 The bill also directs GAO to review and evaluate customer identification procedures used by the prepaid card industry.    \t\u00a0    \tSection 202.\u00a0 Limitation on multiple tax refunds to the same account.\u00a0 An investigation by the Treasury Inspector General identified at least 10 bank accounts that had each received more than 300 fraudulent tax refunds.\u00a0 The bill directs the Treasury Secretary to limit the number of refunds in a year that can be sent to an individual direct deposit account or mailing address. TITLE 3:\u00a0 ADDING CRITICAL NEW PROTECTIONS TO SAFEGUARD SOCIAL SECURITY NUMBERS    \tSection 301.\u00a0 Restrictions on access to the Death Master File.\u00a0 Identity thieves exploit public access to the Social Security Death Master File (DMF) to easily acquire the Social Security numbers of recently deceased persons, which they then use to file fraudulent tax returns.\u00a0 The bill directs the Secretary of Commerce to restrict access to the DMF to certified persons that have a fraud prevention interest or other legitimate need for the information, and it establishes penalties for disclosure or misuse of the information.\u00a0 \u00a0 Section 302.\u00a0 Prohibition on the display of Social Security account numbers on newly issued Medicare identification cards and communications provided to Medicare beneficiaries.\u00a0 The publication of Social Security numbers (SSNs) on Medicare identification cards and other Medicare documents puts millions of individuals at risk of identity theft.\u00a0 The bill requires the Medicare program to phase out the collection, use, and display of SSNs. Section 303, 304, & 305.\u00a0 Prohibition and penalties on the display, sale, or purchase of Social Security numbers.\u00a0 Tax-related identity theft schemes rely on the widespread availability of stolen Social Security numbers (SSNs).\u00a0 Identity thieves obtain SSNs from sources with access to files and databases that contain personal information on clients and customers, such as doctor\u2019s offices, schools, and nursing homes.\u00a0 Federal laws fail to adequately protect SSNs or penalize SSN traffickers.\u00a0 The bill imposes new civil and criminal penalties selling, purchasing, or publicly displaying an individual\u2019s SSN without informed consent. \u00a0 TITLE 4:\u00a0 STRENGTHENING LAWS AND IMPROVING ENFORCEMENT AGAINST TAX-RELATED IDENTITY THEFT Section 401.\u00a0 Criminal penalty for tax fraud through identity theft.\u00a0 Tax-related identity theft is generally prosecuted under a tax provision related to fraud and false statements (\u00a7 7206).\u00a0 Because tax-related identity theft can cause extreme hardships for victims, in addition to loss of government revenue, a tougher penalty is appropriate. The bill increases the maximum penalty for tax-related identity theft from 3 years imprisonment and a $100,000 fine to 5 years imprisonment and a $250,000 fine.\u00a0 The bill clarifies that tax-related identity theft constitutes aggravated identity theft under federal criminal law, potentially adding 2 additional years to the sentence. Section 402.\u00a0 Increased tax preparer penalty for improper disclosure or use of return information.\u00a0 Tax-related identity theft can occur when a paid tax return preparer sells, shares, or uses a client\u2019s tax return information for improper purposes. The penalties for fraudulent disclosure or use of a taxpayer\u2019s personal return information are too weak to deter potential criminals. The current law civil penalty is $250 per disclosure, capped at $10,000 per preparer in a calendar year. The current law criminal penalty is capped at $1,000 per conviction (and one year imprisonment). The bill increases the civil penalty to $1,000 per disclosure, capped at $50,000. It also increases the criminal penalty to a maximum of $100,000 per conviction. Section 403.\u00a0 Authority to transfer Internal Revenue Service appropriations for use for tax fraud enforcement.\u00a0 The bill provides the IRS Commissioner with authority to transfer up to $10 million for tax fraud enforcement from amounts appropriated to other IRS accounts. Section 404.\u00a0 Local Law Enforcement Liaison.\u00a0 State and local law enforcement agencies report difficulty obtaining the cooperation needed to aggressively pursue tax-related identity theft cases. The bill establishes a Local Law Enforcement Liaison (LLEL) within the Criminal Investigative Division of the IRS to administer information-sharing initiatives, respond to inquiries from State and local law enforcement, and ensure that privacy and confidentiality rules are preserved.\u00a0\u00a0\u00a0\u00a0 \u00a0 TITLE 5:\u00a0 ACCELERATING TRANSITION TO A REAL-TIME TAX SYSTEM THAT PROTECTS TAXPAYERS AND REDUCES FRAUD Section 501.\u00a0 Improved detection of fraudulent tax returns through expanded use of the National Directory of New Hires.\u00a0 Effectively combatting tax fraud through identity theft will require the IRS to identify false income information at the time a return is filed.\u00a0 The National Directory of New Hires (NDNH) is a database maintained by the Department of Health and Human Services.\u00a0 It includes timely employment data from W-4 forms, quarterly wage data from State and federal employment security agencies, and other valuable information.\u00a0 Access to the NDNH would improve the ability of the IRS to identify fraudulent returns at the time the return is processed.\u00a0 The bill includes a proposal from the President\u2019s budget authorizing the IRS to use the NDNH to administer federal tax laws. Section 502.\u00a0 Plan of Action for a Real-Time Tax System.\u00a0 Accelerating information matching and creating a real-time tax system is a critical component of the long-run battle against tax-related identity theft.\u00a0 A real-time tax system would offer substantial benefits to taxpayers.\u00a0 According to the Taxpayer Advocate, a real-time system will: (1) allow taxpayers to answer questions and address issues closer to the time of the transactions, (2) prevent taxpayers from facing IRS collection actions long after refunds have been spent, and (3) help taxpayer save money by avoiding the long-term accrual of penalties and interest.\u00a0 The bill directs the Treasury Secretary to issue a report to Congress analyzing and outlining options and potential timelines for moving toward a tax system that reduces burdens on taxpayers and decreases tax fraud through real-time information matching.\u00a0   ###", 1, "2026-03-30T12:14:52Z", "2026-03-30T12:14:52Z"]], "columns": ["url", "title", "date", "year", "month", "party", "chamber", "state", "member_name", "bioguide_id", "domain", "scraper", "source", "date_source", "text", "has_text", "collected_at", "updated_at"], "primary_keys": ["url"], "primary_key_values": ["https://web.archive.org/web/20140115013001/http://www.billnelson.senate.gov:80/news/details.cfm?id=348013&"], "units": {}, "query_ms": 1.1607101187109947, "source": "dwillis/congress-press", "source_url": "https://github.com/dwillis/congress-press", "license": "MIT", "license_url": "https://github.com/dwillis/congress-press/blob/main/LICENSE"}