Tax refund fraud a growing problem in Hawaii - Hawaii News Now - KGMB and KHNL

Tax refund fraud a growing problem in Hawaii

Posted: Updated:
KALIHI, OAHU (HawaiiNewsNow) -

With the tax deadline looming, many Americans are probably wishing someone would swoop in and do their taxes for them.

Be careful, someone may just do so, using your identity.

It's called tax refund fraud, and it's a growing problem for the Internal Revenue Service. Here's how the scam goes: Someone steals your identity, files your taxes using the stolen information, then claims your refund.

"When the real person comes in, they try to file a tax return, the IRS says 'no, you've already been filed'" said tax preparer Hank Erwin.

He's been preparing taxes for more than twenty years, and is especially leery of tax refund fraud.

"This is where they get a lot of money--adding someone else's children on there when they shouldn't, and they get extra credits for having children. At $5,000 a tax return, that can add up to real money after you've done a couple hundred of those" he said.

Hawaii News Now has learned of at least two instances of this happening on Oahu. In one case, the taxes were filed on the mainland.

In the past year the Justice Department has charged almost 900 people with this crime. A report in November stated that the IRS issued $4 billion in fraudulent tax refunds over the previous year to criminals using other people's identities.

The IRS has put up information on its website on how to protect yourself from identity theft, and what to do if you become a victim of it, or tax refund fraud.

You can access their website at: irs.gov 

As for Hank, he protects his customers by doing business face to face.

"We make the client come in, show us an ID before we'll give him his copies".

Hank Erwin owns and operates all five Hank's Tax Service offices. The website is: Hankstax.com 

Follow Chris Tanaka:    

Copyright 2014 Hawaii News Now. All rights reserved.