That is the sensational headline from this Huffington Post story last night   Here is how the more sedate Accounting Today reports it..

Billions in ID Theft–Related Tax Fraud Undetected by IRS

The report, by the Treasury Inspector General for Tax Administration , noted that the IRS reported that it detected 938,664 tax returns totaling $6.5 billion in fraud for processing year 2011 tax returns. Using the characteristics of confirmed identity theft, TIGTA identified approximately 1.5 million additional undetected tax returns with potentially fraudulent tax refunds totaling in excess of $5.2 billion. TIGTA estimates that the IRS could issue $21 billion in fraudulent tax refunds over the next five years

So, instead of solving these serious issues of fraud and tax collection shortfalls in the homeland, let’s launch offshore and spend all our limited resources chasing an estimated $800 million a year instead on world wide FATCA effort, shall we?  That makes sense.  Let’s deploy a distraction strategy to get people to look far away, rather than up close, at home, where the real problems lie.  Don’t look behind the curtain, Dorothy! Continue reading →