With tax season just around the corner, the IRS is gearing up-has been for awhile now-for an influx of fresh cases of income tax fraud. With the advent of nearly total electronic filing, the crime has been sharply increased, putting the federal government to work.

At the federal level, tax fraud is the third largest theft of federal funds, falling just below Medicare/Medicaid and unemployment insurance fraud and rose to an all-time high of 1.1 million cases in 2011. At the state level tax fraud has also increase. In Louisiana, there were nearly 23,000 cases discovered as a result of theft protection measures.

The Louisiana Department of Revenue has taken steps, like the IRS, toward addressing the problem, but it has been a challenge. One tool the state has implemented to address tax fraud is a new fraud protection computer interface. The new system requires that all state income tax returns received on or after January 30, 2013 be subject to identity verification through the new software.

If a returns that are identified as questionable, the taxpayer is directed to a customized online data test or a telephone survey that will serve as a secure method to very his or her identity ad to certify the return.

Because tax fraud is such a drain on federal and state resources, prosecutors are aggressive in prosecuting the offense. Those accused of tax fraud need to secure experienced representation to ensure their rights are protected. Doing so will ensure that the best outcome is achieved in the case.

Source: KATC.com, “New Computer System to Prevent Tax Fraud,” Melissa Canone, January 30, 2013