Democratic senators tout agreement on prisoner tax fraud

An inspector general report released in January found that prisoners had been issued at least $123 million in false federal returns between 2004 and 2009. The two federal agencies came to an agreement on the issue after a push started by Sen. Sherrod BrownSherrod Campbell Brown'Hillbilly Elegy' author won't run for Senate Brown, Portman urge Trump administration to move quickly on a steel decision Dems call on DeVos to work with CFPB to protect student borrowers MORE (D-Ohio) and other Senate Democrats. 

In a statement, Brown called the agreement “a long-overdue, common-sense solution.”

“Government agencies need to work together to prevent tax fraud wherever it occurs, but especially when we're being bilked from behind bars,” Brown said. 

Sens. Chuck SchumerCharles (Chuck) Ellis SchumerSenate Dems hold floor talk-a-thon against latest ObamaCare repeal bill This week: Senate wrapping up defense bill after amendment fight Cuomo warns Dems against cutting DACA deal with Trump MORE (D-N.Y.), Bill NelsonClarence (Bill) William NelsonDem asks airlines to cap airfares ahead of Hurricane Maria Trump encourages Rick Scott to run for Senate Overnight Regulation: House moves to block methane rule | Senators wrestle with allowing driverless trucks | EPA delays toxic waste rule MORE (D-Fla.) and Amy KlobucharAmy Jean KlobucharWeek ahead: Crunch time for defense bill’s cyber reforms | Equifax under scrutiny Some Dems sizzle, others see their stock fall on road to 2020 Consumers the big winners of Amazon-Whole Foods merger MORE (D-Minn.) also praised the agreement.

According to a spokesman from the Bureau of Prisons, the memorandum of understanding between the two agencies will basically help with the enforcement of a 2008 law that allows the IRS to give prisoner tax return information to the prison bureau. (That law was later amended to include state corrections departments.)

The Treasury Department’s inspector general for tax administration found in a report that the IRS was not fully utilizing powers given to it in that measure and that no information had been shared on either the federal or state level. The audit also found that prisoners had falsely claimed close to $300 million in 2009, more than four times as much as in 2004. 

Michelle Eldridge, a spokeswoman for the IRS, said in a statement that the agency “is committed to enhancing its processes to further minimize prisoner refund fraud. We believe the agreement signed with the Bureau of Prisons will help us accomplish that.”

The new federal accord should lead to similar contracts between the IRS and state prison authorities, according to the group of Democratic senators. 

The senators’ release also said that federal prisoners have been able to file false returns by using fake names and Social Security numbers, then having refunds sent to a third party. In state facilities, prisoners have had the ability to file fraudulent returns under their own name.