Senate Bill 3432 – Identity Theft and Tax Fraud Prevention Act

Friday, February 10th, 2012 @ 12:55AM

Senate Bill 3432, Identity Theft and Tax Fraud Prevention Act introduced in the Senate on July 25, 2012. This bill has not passed. CFEG has been told that this bill will be re-introduced in the 113th Congress sometime in 2013.

  • Provides for criminal penalties for using a false identity in connection with a tax fraud.
  • Provides for increased penalties for improper disclosure or use of information by preparers of returns.
  • Provides for a PIN system to prevent theft.
  • Limits the amount of money to $10,000,000 per year that the IRS Commissioner can use for enforcement in preventing and resolving cases of tax fraud.
  • Creates a liaison between state and local law enforcement. Requires IRS to provide an annual report on tax fraud and submit it to the Committee on Finance of the Senate and the Ways and Means of the House.
  • Requires the IRS to submit an annual report to the Committee on Finance in the Senate and to the House Ways and Means Committee detailing the number reports of tax fraud and suspected tax fraud from state and local law enforcement agencies and the actions taken on those reports.
  • Requires the Comptroller General to examine the role of debit cards and commercial tax preparation software in fraudulent tax returns.
  • Places restrictions on the Death Master File to only those persons that the Secretary of Commerce determines has a legitimate fraud prevention interest in the information.
  • Prohibits display of Social Security numbers on newly issued Medicare Id cards and communications to Medicare beneficiaries. Provides for the use and study of smart cards which have anti-fraud attributes.
  • Authorizes the IRS to disclose certain returns and information to prison officials relating to persons incarcerated whom the Secretary has determined may have filed or facilitated in the filing of false or fraudulent tax returns.
  • Provides for the Secretary of the Treasury to review current federal tax laws to determine whether greater information sharing between the IRS and state and local enforcement authorities would improve enforcement.

View Senate Bill 3432 (PDF)

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