Legislation authored by U.S. Sen. Susan Collins (R-ME) to protect individuals from tax refund fraud was approved by the Senate on June 13 as part of the Taxpayer First Act of 2019, and now heads to President Donald Trump to be signed into law.
“Each year, tens of thousands of Americans are victims of tax refund fraud, and seniors are particularly vulnerable,” said Sen. Collins, the chairman of the Aging Committee.
Sen. Collins joined with U.S. Sen. Doug Jones (D-AL) to introduce the Taxpayer Identity Protection Act of 2019, S. 240, back in January in an effort to prevent taxpayers from falling victim to identity theft tax refund fraud. The bill requires the U.S. Treasury Department to create a program to issue a six-digit number that may be used in connection with a Social Security number, or other identifying information, to assist in verifying an individual’s identity, according to the text of the bill.
Identity theft refund fraud occurs when a crook files a false tax return using a stolen Social Security number and other personal information and gets a tax refund from the IRS. Victims lost a total of $1.7 billion in 2016 from identity theft refund fraud, Sen. Collins’ office noted.
Specifically, S. 240 would require the IRS to expand its Identity Protection PIN (IP PIN) pilot program over the next five years. Taxpayers would not be required to use an IP PIN, but the legislation would allow them to opt-in to the program if they want extra identity protection. If a tax return is filed with an incorrect or missing IP PIN, the IRS would automatically reject the return until the identity of the filer can be confirmed, the senator’s office explained.
“Having an IP PIN has proven to protect against identity theft,” Sen. Collins said. “I am delighted that Congress has taken this concrete action to help protect taxpayers from being ripped off by criminals and ensure that they receive the refunds to which they are entitled.”