Families of the Deceased Suffer Tax Refund Fraud Pain


The loss of a family member is difficult enough to deal with when it happens, and it impacts affected family members forever. But how do you react when you learn that a deceased family member has been claimed as part of someone’s tax refund fraud scheme? According to a story posted by ABC15.com, this tragedy has plagued nearly 28 known families nationwide, escalating the issue to reveal that 350,000 tax returns were improperly submitted claiming deceased citizens during the last tax season. (That’s a lot of dead guys.)

The article describes how Terri Tresise lived through the death of her 18-year old son Tyler only to learn a month and a half later that someone else filed for a tax refund falsely claiming him as a dependent. It surmises that the data used to perpetrate tax refund fraud in this instance was likely found in the Social Security Administration’s (SSA) Death Master File. This site is updated weekly and includes the names and Social Security Numbers of the deceased. When confronted about the problem, the Internal Revenue Service (IRS) released a statement? ”The IRS investigates these situations, aggressively pursues the scam artists and in many cases, works with the Department of Justice to criminally prosecute cases.”

How do we eliminate this problem? According to the article, it will take an act of Congress to allow the SSA to remove the Social Security Numbers from the site. The SSA revealed that they are required to make public the deceased’s Social Security Numbers to comply with the Freedom of Information Act. Criminals are using this information to steal billions from the U.S. Government. Just crazy! I think it’s time that Congress takes action to ensure that such sensitive information is accessible only to those who will adequately protect it.

Source: Today’s ”Fraud of the Day” is based on an article entitled, ”Families of Deceased Children the Target of Tax Fraud” by Rebecca Thomas, published by ABC15.com, December 12, 2011.

APACHE JUNCTION, AZ – Imagine having to deal with the loss of your child, only to learn a few months later someone else has falsely claimed them on a tax return.

That’s exactly what happened to a family in Apache Junction.

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.