The Government Accountability Office (GAO) in Washington D.C. has reported that the federal Internal Revenue Service has seen nearly a five-fold increase in taxpayer identity theft between 2008 and 2010.
In its news account of the GAO report, the Associated Press reported that there were 248,357 incidents in 2010, compared to 51,702 in 2008.
Massachusetts DOR has seen a relatively small number of known identity theft cases in tax year 2010, and has posted on its website advice and guidance on how to deal with tax identity theft should it occur.
As the AP reported, typically, tax identity thieves submit tax returns for refunds early in the filing season. The legitimate taxpayer whose identity has been stolen usually files later, and only then learns from the tax agency that a return has already been filed using the same Social Security number.
The IRS has established a website, www.STOPFRAUD.gov, which instructs taxpayers on what to do if they suspect identity fraud.
This story from Reuters also explains why the difficulty tax agencies have in preventing identity theft.