Will You Get Mad With Me?

July 16, 2015

Normally I use the precious opportunity of writing this commentary as a means to share the virtues of my beloved Petoskey, where I live and work. Rest assured, Petoskey is having a robust summer like most northern Michigan communities. Tourism is alive and well, and our resorters have returned to their summer cottages. We have more jobs than we have workers, we have more cars than we have spaces, and more diners than we have tables. The town looks beautiful, the weather is pleasant, and there is a smile on the face of this chamber of commerce professional.

Yet, on the inside, I’m hopping mad. I’m not mad about the state of our community or the busy tourist season, I’m mad at our federal government. And, on this occasion, I want to use this precious guest commentary to get everyone else mad too. Will you join me?

My family was one of those victims of identity theft. Someone acquired my name and social security number, filled out an IRS tax form with that information, had the IRS send a nice tax refund to their bank account, and then disappeared. So when I filed our family’s legitimate income tax return, I was told by the IRS that a tax refund had already been issued to me. They said that perhaps I had been a victim of tax fraud and that this is going to take several months, maybe even more than a year to sort this out. So I go without my legitimate tax refund while I wait, and wait, and wait.

I had a rare glimpse of the tax form that had been filed by the identity thief. Since I have a child in college, I was filling out the financial aid form known as FAFSA. On the form, you can now download the relevant information from your tax return directly onto your FAFSA form. When I went to do this, there was nothing remotely familiar with my tax return data. The return that had been submitted in my name included two dependents whereas I have four children, a salary level that wasn’t even close to mine, and a one-income household whereas we have a two-income household. The names of dependents didn’t match my family’s and, obviously, the bank account was different. The only thing that resembled my tax form was my name and social security number. Everything else was different.

Doesn’t it make sense that the one year when a tax return is filed with my name and social security number, and everything else is dramatically different, that a red flag would go up on a computer someplace? Shouldn’t some system be in place to say, "Whoa, this information is dramatically different, let’s delay sending this tax refund until we sort this out?" Instead a perpetrator ends up with some free money from the federal government, while the legitimate tax payer waits for a year hoping to one day see the refund he has coming.

In looking into this, I found Associated Press articles that stated the federal government pays more than $5 billion annually in fraudulent tax refunds. $5 billion! Since telling my story to anyone who will listen, I’ve discovered many people right here in northern Michigan who have also been in this same situation. This is a very common occurrence.

As Americans, we should be appalled that our government pays out $5 billion per year to criminals who have learned how to cheat the system. In those AP articles, justice department officials assured that steps were being taken to put an end to fraudulent tax refunds, but I’m not convinced. I think our lawmakers need to hear from angry U.S. citizens who want our government to take better care of our money. Americans got mad about our Veterans Administration last year and the poor care they provided veterans in the VA health care system. Lawmakers got involved and changes were made. I think it’s time for Americans to get equally mad about tax fraud and insist that changes be made within the IRS to fix this problem.

I know it will not be an easy fix. And I know the criminal element moves faster in the cybercrime world than our government can move. But to have $5 billion of taxpayers’ money seep out each year in fraudulent returns is criminal in itself and needs to be fixed right away.

Are you mad too?

I now return you to our beautiful summer in northern Michigan.

Carlin Smith is the president of the Petoskey Regional Chamber of Commerce