That’s Billion with a “B!”

Posted by & filed under Accounting Information Systems, Accounting Principles, Auditing, Cost Accounting, Ethical Dilemma, Financial Accounting, Fraud Accounting, Intermediate Accounting, Managerial Accounting.

According to the Washington Post, the IRS paid $3.1 billion in bogus tax refunds in 2014 due to ID theft. Yes, that’s billion with a “B.”

Questions:
1. How many individual tax returns did the IRS process in 2015?
2. What percentage and amount did the IRS identify as fraudulent claims before it paid them?
3. What is the TPP program and how are fraudsters able to circumvent detection?
4. Where does the IRS need to do more work and risk assessment to prevent these fraudulent payments?

Source:
Davidson, J. (2016). $3.1 billion – at least — lost in bogus tax refunds to ID thieves in 2014. The Washington Post, July 1 (Retreivable online at https://www.washingtonpost.com/news/powerpost/wp/2016/07/01/3-1-billion-lost-to-id-theft-tax-fraudsters-in-2014-at-least/?tid=hybrid_collaborative_2_na)

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