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house Bill H.R. 3832

Keeping Identity Thieves From Stealing Tax Refunds

Argument in favor

The IRS needs to take steps to ensure that criminals aren’t stealing taxpayers’ identities and fraudulently claiming tax refunds. This bill gives them a framework to protect taxpayers.

05/16/2016
If the IRS can't even protect itself, how is it going to be able to protect anyone else?
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operaman's Opinion
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05/16/2016
My niece recently was notified that she had her identity stolen by the IRS. I have had mail stolen from our mailbox and neighbors have had their mailbox destroyed by Mail thieves. When my wife reported the missing mail, the USPS recommend renting a PO box. Very helpful. Local TV news showed videos of UPS and FedEx packages being stolen. Local, state and federal laws are broken, but when have you witnessed a capture or persecution of a mail thief? RARELY. it would cost the government time and taxpayers money to investigate and incurring budget problems. Let's bring back the laws of the early West. Catching, trial and sentenced in one day. Like the Emerson commercial states, "problem solved." And that tree in the town center solved many nasty problems.
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BTSundra's Opinion
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05/16/2016
Last thing we need are identity thieves stealing from the government too.
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Argument opposed

It's unlikely that this bill will actually be able to prosecute larger numbers of identity thieves and criminals who fraudulently misappropriate taxpayer information.

Alex's Opinion
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05/16/2016
The IRS is never going to do anything good. It needs to be replaced, not given more responsibility.
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pgshpak's Opinion
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05/16/2016
Congress doesn't have $10 million dollars.
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Nathan 's Opinion
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05/16/2016
in a way, this bill would increase the scope of the IRS who is already expanding around the country to local operations. Much of the bill mimics responsibilities already delegated. The IRS is also already preventing 70% of fraudulent claims, so the increased scope seems unnecessary.
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bill Progress


  • Not enacted
    The President has not signed this bill
  • The senate has not voted
      senate Committees
      Committee on Finance
  • The house Passed May 16th, 2016
    Passed by Voice Vote
      house Committees
      Committee on the Judiciary
      Committee on Ways and Means
    IntroducedOctober 26th, 2015

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What is House Bill H.R. 3832?

This bill would seek to reduce identity theft from federal tax forms by requiring the Internal Revenue Service (IRS) to take steps to guard against fraudulent tax returns and refund claims.

There are three actions specific steps that the IRS would be directed to take to improve the security of taxpayer information:

  • Require that Form 1099, which reports non-employee compensation, be filed by February 15 the year after the calendar year in which the money was earned;

  • Require taxpayers be notified by the Dept. of the Treasury if there’s an unauthorized use of their taxpayer identity and any criminal charges filed;

  • Require a taxpayer identifying number on W-2 forms instead of a Social Security number;

  • Impose a criminal penalty on a person who willfully misuses another person’s taxpayer identity.

The IRS would be required to:

  • Ensure that taxpayers who are the victims of identity theft have a centralized point of contact at the IRS;

  • Implement a program to allow a taxpayer who has filed an identity theft claim to choose to prevent the processing of any tax return filed electronically by someone claiming to be the taxpayer;

  • Report every two years to congressional committees about taxpayer identity theft and tax refund fraud, in addition to actions taken to combat it.

Additionally, this legislation would give the IRS access to information in the National Directory of New Hires for the sole purpose of identifying and preventing fraudulent tax return filings and refund claims.

Impact

People who may have their identity stolen or tax refund fraudulently taken by someone else; and the IRS.

Cost of House Bill H.R. 3832

$10.00 Million
The CBO estimates that implementing this bill would cost about $2 million per year, or a total of $10 million over the 2017-2021 period. It would also lead to additional revenue from prosecutions and ensuing penalties, though that amount is expected to be relatively small.

More Information

In-Depth: Sponsoring Rep. Jim Renacci (R-OH) — whose identity was stolen and a fraudulent tax return was filed in his name — introduced this bill to prevent other taxpayers from going through similar scenarios:

“This past tax season, someone used my stolen personal information and filed a fraudulent tax return in my name, claiming a refund.  I didn’t learn about this fraud until I received an IRS notice questioning a return I had filed—even though I had not yet even filed. I have heard of many similar stories from Northeast Ohio taxpayers who also were victims of identity theft-related tax fraud.  Congress and the IRS must work together with industry to better shield taxpayer dollars from thieves and reduce the hardships caused by this increasing criminal activity.”

This legislation was passed by the House Ways and Means Committee on a voice vote, and has the support of 26 bipartisan cosponsors — including 19 Republicans and seven Democrats.


Of Note: According to a study by the Government Accountability Office (GAO), identity thieves received $5.2 billion in fraudulent tax refunds from the IRS in 2013, although the IRS did prevent or recover over $24 billion in attempted refund fraud.


Media:

Summary by Eric Revell
(Photo Credit: Flickr user Christopher Dombres)

AKA

Stolen Identity Refund Fraud Prevention Act of 2016

Official Title

To amend the Internal Revenue Code of 1986 to prevent tax-related identity theft and tax fraud, and for other purposes.

    If the IRS can't even protect itself, how is it going to be able to protect anyone else?
    Like (12)
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    The IRS is never going to do anything good. It needs to be replaced, not given more responsibility.
    Like (13)
    Follow
    Share
    My niece recently was notified that she had her identity stolen by the IRS. I have had mail stolen from our mailbox and neighbors have had their mailbox destroyed by Mail thieves. When my wife reported the missing mail, the USPS recommend renting a PO box. Very helpful. Local TV news showed videos of UPS and FedEx packages being stolen. Local, state and federal laws are broken, but when have you witnessed a capture or persecution of a mail thief? RARELY. it would cost the government time and taxpayers money to investigate and incurring budget problems. Let's bring back the laws of the early West. Catching, trial and sentenced in one day. Like the Emerson commercial states, "problem solved." And that tree in the town center solved many nasty problems.
    Like (12)
    Follow
    Share
    Last thing we need are identity thieves stealing from the government too.
    Like (9)
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    Congress doesn't have $10 million dollars.
    Like (7)
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    We American citizens pay our taxes for various reasons to assist with the stimulation of our economy, public resources, education, our safety/for law enforcement, the national debt, social security, and an abundant amount more. As Americans we pay our tax dollars to be invested in the economy not invested in a cold hearted thief. All these individuals want to do is promote greed and demonize American economic values. The federal government must take immediate and an increase in enforcement to diffuse issues such as these matters. It's imperative that fraud cases are reduced to leave a bright future for generations to come. Taxes are payed, and transferred to the federal government in which they must invest the money into the economy to regulate occupational opportunities for the tremendous amount of the unemployed. Oh and I beg of you to please not say that the unemployment rate is a miniature amount, ITS A CRUMBLING/ DISASTROUS MATTER AND YOU KNOW IT, DONT DENY IT. The bottom line is the federal government and especially our new commander in chief must bring innovative legislation and enforcement to Washington to fulfill some key aspects of our economy. Such examples resembles this deceitful little community known as Identity thieves.
    Like (6)
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    Rep. Renacci gives us 5.2 billion reasons for passing this bill: According to a study by the Government Accountability Office (GAO), identity thieves received $5.2 billion in fraudulent tax refunds from the IRS in 2013, although the IRS did prevent or recover over $24 billion in attempted refund fraud. http://renacci.house.gov/index.cfm/press-releases?ID=1957C1F9-9EAF-4974-9D95-5CAF74DA4A2B
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    Yes, but in the meantime, just use Al Sharpton's tax info and you can run a 2 Million Dollar tab with impunity!
    Like (5)
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    Identity theft should be prosecuted to the fullest extent of the law.
    Like (5)
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    in a way, this bill would increase the scope of the IRS who is already expanding around the country to local operations. Much of the bill mimics responsibilities already delegated. The IRS is also already preventing 70% of fraudulent claims, so the increased scope seems unnecessary.
    Like (4)
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    We need to restructure the IRS, at the very least! If not, we need to implement an entirely new system that is modernized and capable of handling any--let alone MORE--responsibilities. The purpose of this bill is respectable, but misguided in how it seeks to prevent identity theft through tax fraud
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    I'm all for stopping any form of theft. Perhaps the IRS should start by disbanding.
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    Unfortunately, I expect them to actually release personal information even as they try to safeguard it. They are inept and corrupt. Eliminate them after changing the tax codes.
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    Abolish the IRS. Implement a much less lengthy and confusing policy, with few (if Any) loopholes.
    Like (3)
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    This bill would require the costly steps of setting up new IRS branches to fight identity theft, while such service are already privately available and very efficient.
    Like (3)
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    Fraud is a huge crime that is on the rise, we need to make fraud more preventable in any way possible. We are losing billions due to fraud, and we must stop it to the best of our ability.
    Like (3)
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    stealing is bad???
    Like (3)
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    The IRS has sensitive information on every taxpayer. There has been news of people's data being compromised. I feel like in order for the public to keep trusting them with that info they should ramp up their preventative measures.
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    I work in the finacial sector. These protections already exist and do no good.
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    They have the information, it can be stolen. They should protect it.
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