By John David Powell
Woo hoo, Boo Boo! Houston just made another Top 5 list!
Okay, maybe we should say “boo hoo” instead. That is because Houston joins the list of U.S. cities most likely to have big-time identity thieves stealing billions of dollars by filing fraudulent tax returns.
This dubious distinction comes from a special investigation (www.treasury.gov/tigta/
auditreports/2012reports/ 201242080fr.pdf) by the inspector general (www.treasury.gov/tigta) for the Internal Revenue Service that found the IRS paid out $5.2 billion in possible fraudulent refunds in 2010, with nearly $1 billion going to addresses in Houston and four other cities.
For those keeping score at home, that list includes Tampa ($468.3 million), Miami ($280.5 million), Atlanta ($77.1 million), Detroit ($74.3 million), and Houston ($72 million).
The IG for the IRS says these five cities collectively accounted for more than 239,000 questionable tax returns.
Two of the top five cities are in Florida: Tampa and Miami. And the Sunshine State is the home port of Sen. Bill Nelson (http://billnelson.senate.gov) who asked for the audit, like maybe he had an inkling of what was going on.
This is encouraging, though, because Nelson is a Democrat whose party daily demonizes the so-called one-percenters and demands new taxes on the people already paying more than twice the effective tax rate of those in the middle class: 29 percent versus 11 percent. Do not blame the messenger if this makes your hair catch fire; blame the Congressional Budget Office for its latest report(www.cbo.gov/publication/43373
) on the subject.
Getting back to the topic at hand, we now have proof identity thieves are ruining lives and draining government coffers by openly sending in fake tax returns on or before the April 15 filing deadline.
Nearly 5,000 potentially fraudulent returns filed in 2010 came from just five addresses in the country. And only one of those addresses was in a city on the top five list. That was a single address in Tampa that filed 518 phony returns that resulted in $1.7 million in tax refunds.
The number one address in the country was in Lansing, Mich., where an ID thief sent in 2,137 bogus returns and came away with $3.3 million. Someone at a Chicago address sent in 765 returns and got back $903,000. And a scammer in Orlando, Fla., mailed in 703 returns that returned $1.08 million.
But until the inspector general started poking around, no one at the IRS noticed that some thieving pinhead in Belle Glade, Fla., with a population of 17,667, submitted 741 fake returns and walked off with a cool million Uncle Sam dollars.
This month Nelson reached across the aisle to join Republican Sen. Tom Coburn(www.coburn.senate.gov) of Oklahoma in introducing a bill to plug the holes in the tax system that allow ID thieves to operate by making it harder for them to use stolen Social Security numbers on tax returns. The bill also expands a program that provides a personal ID number to previous victims of identity theft so they do not become repeat victims.
Other recent bipartisan efforts include a bill to help prosecute ID thieves and make them pay for their deeds, instead of the American tax payer.
This is the kind of work we expect out of our federal lawmakers, our representatives in Washington, the people we elect to take care of us and not themselves.
Gene Green (http://green.house.gov), a Democrat representing the Texas 29th, once said people would be surprised how much money flows into Washington every day. And thanks to the IRS investigation, we have a small example of how much flows out of Washington every day.
Maybe we should demand the folks in Washington spend more time keeping the bad guys from taking our good money than figuring out ways to raise more money that someone is just going to steal.
John David Powell writes his Lone Star Award-winning columns from ShadeyHill Ranch in Texas.