Senators seek end to prisoners’ bogus tax refunds

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Senators seek end to prisoners’ bogus tax refunds

Wall Street Journal – ALBANY, N.Y. — Prisoners nationwide have bilked taxpayers out of $123 million in the last five years through phony tax refunds they applied for from their cells, according to four senators.

Sens. Charles Schumer of New York, Sherrod Brown of Ohio, Amy Klobuchar of Minnesota and Sen. Bill Nelson of Florida said the Federal Bureau of Prisons and the Internal Revenue Service have failed to cooperate and comply with a 2008 law aimed at stopping the practice in federal and state prisons nationwide. Prisoners use their own names or the names of friends and associates to submit false claims to receive and cash refund checks.

"It is outrageous to think that convicted felons are able to fleece taxpayers from a jail cell," Schumer told The Associated Press. He said the federal agencies' "failure to share information has not only allowed this fraud to continue to occur, but has allowed it to more than double since 2004."

IRS and Bureau of Prisons spokeswomen say they are working to end gaps in what is already substantial enforcement against the practice. But the IRS says congressional action is needed to require prisons to report their tax status to the Bureau of Prisons.

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