‘IRS should notify victims of tax identity theft,’ Sen. Warner says

Sen. Mark Warner (D-Va.) said the IRS should inform taxpayers when they have become victims of tax identity theft.

“If we’re looking at $5.8 billion in fraudulent refunds [in 2013], making sure the IRS informs people when they’ve been the victims of identity theft, I think, would be a step in the right direction,” he said during the Senate Finance Committee hearing Thursday on protecting taxpayers from schemes and scams during the 2015 tax filing season.

He asked if the IRS could create a national education system where taxpayers could be notified of tax scams and check to see if a fraudulent return has been filed on their behalf.

“It’s a matter of finding the resources,” said Timothy Camus, deputy inspector general for investigations at the Treasury Inspector General for Tax Administration.

The IRS has said funding cuts have made it all the more difficult for the agency to combat tax fraud. Congress has cut the agency’s funding by $1.2 billion since 2010, resulting in a workforce reduction of more than 13,000 employees. The agency was budgeted $346 million less in 2015 than it received in 2014, with $10.9 billion to spend for the year.

During the hearing, Warner also called for a national standard for financial institutions and retailers to follow for reporting a data breach.

“This is an area where there’s a lot of finger pointing between the retail sector and the financial sector,” he said.