House Ways and Means Oversight Subcommittee Chairman Charles W. Boustany Jr., M.D., (R-LA), and Social Security Subcommittee Chairman Sam Johnson (R-TX) today announced that the Subcommittees will hold a joint hearing on improper payments and identity theft. The hearing will take place at 1:00 p.m. on Wednesday, December 11, 2013, in room 1100 of the Longworth House Office Building.
In view of the limited time available to hear from witnesses, oral testimony at this hearing will be from invited witnesses only. However, any individual or organization not scheduled for an oral appearance may submit a written statement for consideration by the Committee and for inclusion in the printed record of the hearing. A list of invited witnesses will follow.
Over the last ten years, the Internal Revenue Service (IRS) erroneously paid over $140 billion in improper payments arising from refundable tax credits. Earned Income Tax Credit (EITC), the largest refundable tax credit, consistently ranks among the top sources for erroneous payments out of all government programs. Last year, 21 to 25 percent of EITC payments were erroneous, costing American taxpayers as much as $13.6 billion. Other refundable credits, like the Additional Child Tax Credit, American Opportunity Tax Credit, and Adoption Credit, also cost taxpayers billions of dollars in improper payments.
Also driving the rates of erroneous payments is the epidemic of tax-related identity theft, which occurs when an individual files a false tax return using the name and Social Security Number (SSN) of another taxpayer without their knowledge, including those who are deceased, in order to obtain a tax refund from the IRS. Under current law, fraudsters are able to obtain SSNs for deceased Americans from the Death Master File, which the Social Security Administration is legally required to make public. TIGTA’s 2013 review of Tax Year 2011 identified approximately 1.1 million tax returns that used SSNs linked to identity theft that went undetected by the IRS. The amount of potentially fraudulent refunds amounted to approximately $3.6 billion. While the IRS has made some progress in detecting fraudulent returns, TIGTA’s review found that the number of fraudulent returns missed by the IRS remains unacceptably high. For instance, the TIGTA review revealed that the IRS failed to stop 580 fraudulent returns all filed with the same Orlando, Florida address. This resulted in over $870,000 in refunds being issued to fraudsters, to that single address alone.
In announcing the hearing, Chairman Boustany said, “Our country is facing enormous federal deficits and record federal debt, and the last thing taxpayers can afford is for the IRS to hemorrhage tens of billions of dollars in improper payments. Rather than allowing the same problems to continue unchecked year after year, it is long past time for the federal government to get its house in order and stop this fraud, waste and abuse of taxpayer dollars.”
Chairman Johnson added, “From rampant identity theft-tax refund schemes to a scandal-ridden ITIN program to fraudulent child tax credit payments, report after report show an IRS that is failing to prevent billions of taxpayer dollars from being wasted due to fraud and abuse. The American taxpayer is losing confidence in our tax system, and the IRS has only itself to blame. Hardworking taxpayers deserve better.”
FOCUS OF THE HEARING:
The hearing will focus on the Internal Revenue Service’s efforts to curb improper payments, especially those arising from identity theft.
DETAILS FOR SUBMISSION OF WRITTEN COMMENTS:
Please Note: Any person(s) and/or organization(s) wishing to submit written comments for the hearing record must follow the appropriate link on the hearing page of the Committee website and complete the informational forms. From the Committee homepage, https://waysandmeans.house.gov, select “Hearings.” Select the hearing for which you would like to submit, and click on the link entitled, “Click here to provide a submission for the record.” Once you have followed the online instructions, submit all requested information. ATTACH your submission as a Word document, in compliance with the formatting requirements listed below, by the close of business on Thursday, December 26, 2013. Finally, please note that due to the change in House mail policy, the U.S. Capitol Police will refuse sealed-package deliveries to all House Office Buildings. For questions, or if you encounter technical problems, please call (202) 225-3625 or (202) 225-5522.
The Committee relies on electronic submissions for printing the official hearing record. As always, submissions will be included in the record according to the discretion of the Committee. The Committee will not alter the content of your submission, but we reserve the right to format it according to our guidelines. Any submission provided to the Committee by a witness, any supplementary materials submitted for the printed record, and any written comments in response to a request for written comments must conform to the guidelines listed below. Any submission or supplementary item not in compliance with these guidelines will not be printed, but will be maintained in the Committee files for review and use by the Committee.
1. All submissions and supplementary materials must be provided in Word format and MUST NOT exceed a total of 10 pages, including attachments. Witnesses and submitters are advised that the Committee relies on electronic submissions for printing the official hearing record.
2. Copies of whole documents submitted as exhibit material will not be accepted for printing. Instead, exhibit material should be referenced and quoted or paraphrased. All exhibit material not meeting these specifications will be maintained in the Committee files for review and use by the Committee.
3. All submissions must include a list of all clients, persons and/or organizations on whose behalf the witness appears. A supplemental sheet must accompany each submission listing the name, company, address, telephone, and fax numbers of each witness.
The Committee seeks to make its facilities accessible to persons with disabilities. If you are in need of special accommodations, please call 202-225-1721 or 202-226-3411 TTD/TTY in advance of the event (four business days notice is requested). Questions with regard to special accommodation needs in general (including availability of Committee materials in alternative formats) may be directed to the Committee as noted above.
Note: All Committee advisories and news releases are available on the World Wide Web at http://www.waysandmeans.house.gov/.