IRS Is Fine With A Little Fraud, Rejects GAO Recommendation

Internal Revenue Service (IRS) officials shot down a congressional watchdog’s plea to improve the federal tax agency’s monitoring system to prevent paying fraudsters tax returns, according to a new Government Accountability Office (GAO) report.

GAO officials urged the IRS to beef up oversight of tax returns after IRS managers told GAO auditors some IRS employees release tax returns when the filer’s account is under review or that person filed more than one tax return, often because IRS representatives don’t understand the codes on a taxpayer’s account. But IRS officials defied GAO’s recommendation.

“IRS disagreed with our recommendation to improve data for monitoring refund releases, stating that the problem is not widespread and current processes are sufficient,” GAO said. “We maintain that the data IRS uses are not sufficient to make such a determination.”

GAO also discovered the IRS doesn’t notify taxpayers when a dependent’s name appears on a fraudulent tax form.

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