Unless you live in Utah, the name of Jason Chaffetz may not be familiar to you. Jason Chaffetz is a Congressman from Utah, the Chairman of the House Oversight Committee and a recent victim, as he disclosed this week, of income tax identity theft. Chaffetz did not find out he was a victim of income tax identity theft until he went to file his income tax return only to be told that someone else had filed using his name and Social Security number. Fortunately for Chaffetz he owed money to the IRS so the fact that he is a victim of income tax identity theft will not delay the payment to him of a refund. Those victims of income tax identity theft who are owed a refund find insult added to injury as they must wait many months before the IRS completes its investigation and sends a refund. Chaffetz has long been a critic of IRS Commissioner John Koskinen and this latest matter has only added to the reasons Chaffetz is using in asking for Koskinen to be fired.
Although Congressman Chaffetz is rightfully placing much of the blame for income tax identity theft on Commissioner John Koskinen, there is plenty of blame for income tax identity theft on the part of Congress itself which continues to fail to pass legislation to require employers to file W-2s with the IRS at the same time they file them with the Social Security Administration. Presently, employers file W-2s for their employees with the Social Security Administration either at the end of February or March depending on whether they are filing electronically or by paper. The Social Security Administration does not get around to sending the W-2s to the IRS until July, long after the IRS has already sent out refunds to many income tax identity thieves who filed counterfeit W-2s. If the IRS received W-2s early and compared them to the W-2s filed with income tax returns before sending out refunds, a tremendous amount of income tax identity theft could be avoided. As for what we as taxpayers can do to protect ourselves from income tax identity theft, the best things you can do are to keep your Social Security number private and file your income tax return early before an identity thief files one before you do.