WASHINGTON — The IRS is joining with states and private industry to combat identity theft by sharing more data about how tax returns are filed, officials announced Thursday. The effort is aimed at stemming a problem that has victimized thousands of taxpayers and cost the government billions of dollars from fraudulent returns.
IRS Commissioner John Koskinen said the new procedures will be in place by the time taxpayers file their 2015 returns next year.
"We all understood that no single organization can go it alone," Koskinen told reporters in a conference call that included officials from states and tax software, tax preparation and other companies. "None of us has a silver bullet to defeat this enemy."
The steps were announced two weeks after the IRS acknowledged that criminals had stolen personal information about 104,000 taxpayers from an agency website.
At the time, Koskinen said the lawbreakers had already used the data to claim up to $50 million in fraudulent tax refunds. Two officials told the Associated Press that the IRS thinks the criminals were based in Russia.
Overall, the IRS has estimated it paid $5.8 billion worth of fraudulent refunds to identity thieves in 2013.
Koskinen said existing procedures identified 3 million suspicious tax returns this year before they were processed, 700,000 more than last year.
Officials also recently revealed that the government faces a far broader problem. Hackers in China have broken into the federal government's personnel agency, the Office of Personnel Management, and stolen identification information of at least 4 million federal workers.
An official of a federal employees' union said Thursday that the problem was even worse than officials have described and that the hackers have stolen Social Security numbers and other personnel data for every federal worker.
Koskinen said government and industry officials have agreed to share new information aimed at stopping identity theft as fraudulent returns are filed.