Majority Press

Senators Collins, Jones Introduce Bill to Prevent American Taxpayers and Seniors from Falling Victim to Identity Theft

Legislation incrementally expands and makes permanent the IRS’ Identity Protection PIN pilot program

Fraudulent returns amounted to $1.7 billion in 2016

Washington, D.C. - In order to help combat identity theft and protect hardworking Americans from being robbed of their tax refunds through fraud, U.S. Senators Susan Collins (R-ME) and Doug Jones (D-AL) introduced the Taxpayer Identity Protection Act, legislation requiring the IRS to expand its Identity Protection PIN (IP PIN) pilot program nationwide over the next five years. 


While taxpayers would not be required to use an IP PIN, Senators Collins and Jones’ legislation would allow them to opt-in to the program if they desire an extra layer of identity protection. The five-year incremental expansion would provide accountability that the IRS is adequately building out the IP PIN program, while at the same time ensuring taxpayers have access to the extra layer of security as soon as possible.


“This commonsense legislation is a win-win because it expands identity theft protections to taxpayers across the nation, while also saving taxpayers billions of dollars every year in improper refund payments,” said Senator Collins.  “I urge my colleagues to support this phased expansion of the successful IP PIN program.”


“Doing your taxes is difficult enough as it is,” said Senator Jones. “Folks shouldn’t face the threat of theft when going the filing process with the federal government. I’m proud to join Senator Collins on this bipartisan legislation that will protect Americans from tax refund fraud.”


Identity theft refund fraud occurs when a scammer files a false tax return using a stolen Social Security number (SSN) and other personal information and receives a tax refund from the IRS.  An IP PIN is a six-digit number assigned to eligible taxpayers that allows their tax returns and refunds to be processed without delay and helps prevent the misuse of their SSNs on fraudulent income tax returns.  If a tax return is filed with a Social Security number and an incorrect or missing IP PIN, the IRS’ system automatically rejects the return until the identity of the filer can be confirmed.


In 2017, the Federal Trade Commission received more than 62,600 complaints related to tax-refund fraud.  Fraudsters often target vulnerable older Americans, an estimated 76,000 of whom were victims of identity theft refund fraud in 2010 alone.  Those who have been defrauded often wait months—even years—to receive the refunds to which they are legally entitled.


While the IRS has made significant progress in combatting identity theft refund fraud, it continues to be one of the biggest challenges facing the agency, totaling $1.7 billion in 2016.  These fraudulent tax refund payments waste taxpayer dollars, jeopardize the legitimate refunds of taxpayers, and threaten the integrity of the IRS.


Since 2013, the IRS program has offered IP PINs to victims of identity theft as well as all residents of Florida, Georgia, or the District of Columbia, which have the highest per-capita percentage of identity theft refund fraud in the country.