Taxable Talk

My father died almost six years ago. It’s something that’s inevitable for all of us. My mother was lucky in one respect: No one stole my father’s identity at death. Unfortunately, such identity thefts are becoming far more common.

Jason Dinesen, an Enrolled Agent in Iowa, ran a seven-part story in his blog relating the identity theft of a young widow’s late husband. He has four conclusions (all of which are valid imho). I’m going to focus on the last one:

Congress needs to do something to fix the problem with the Death Master File. It’s ridiculous that the government publishes something that is such a goldmine for identity theft.

I’ll add another story of identity theft. My partner’s stepfather passed away last January. When we filed his 2010 tax return we discovered that he was a victim of identity theft. Someone from Tampa, Florida (hundreds of miles away from where the stepfather lived) filed a tax return using his name and social security number. We both asked ourselves how in the world did a Tampa resident get the name and social security number? There were absolutely no connections between the stepfather and Florida. We both thought that the most likely means was the Death Master File.

So you’re asking, what is the Death Master File? Well, you can find it on the Internet.
While a single search costs about $10, you can search 1 million names for $12,000. If I’m a crook and I want to do some identity theft, I don’t need that many names. I could just do 5,000 for only $1,500. If each of my 5,000 phony tax returns nets me $1,500, I’ll have a very nice rate of return.

Mind you, I can see that there are legitimate purposes for the Death Master File. When I initially became an IRS e-service provider I went through a background check. At a minimum, such checks should be required for subscribers to the Death Master File.

Identity theft is a growing crime. To have the government assisting in the crime is horrible. Yet that’s exactly what’s happening today.

Tags: Death.Master.File, Identity.Theft, Social.Security.Administration

This entry was posted on Sunday, August 26th, 2012 at 6:51 pm and is filed under IRS. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.