Prisoners in Florida, Georgia, and California lead the inmate population in scamming payments from the IRS, says a federal audit reported by USA Today. Prisoners in the three states got nearly $19 million in IRS refunds during 2009 after filing false or fraudulent tax returns, said an an IRS report to Congress. It was part of $39.1 million in undeserved federal tax refunds the IRS issued to jail and prison inmates nationwide for phantom jobs on phony returns. That’s nearly triple the $13.4 million in tax refunds the IRS issued to prison scammers five years earlier.
The IRS said it could not immediately determine how much, if any, of the fraudulent refunds in 2009 has been recovered, because the recapture process “can take several years.”J. Russell George, Treasury Department inspector general for tax administration said that if the IRS does not take action, the problem will only worsen and more taxpayer dollars will be lost.” He added that “prisoners continue to find new ways to exploit weaknesses in the system in order to receive refunds to which they are not entitled.”