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[House Hearing, 115 Congress]
[From the U.S. Government Publishing Office]

     SCAM SPOTTING: CAN THE IRS EFFECTIVELY PROTECT SMALL BUSINESS 
                              INFORMATION?

=======================================================================

                                HEARING

                               BEFORE THE
                               
                      COMMITTEE ON SMALL BUSINESS
                             UNITED STATES
                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED FIFTEENTH CONGRESS

                             FIRST SESSION

                               __________

                              HEARING HELD
                             APRIL 6, 2017

                               __________

[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]                             
                               

            Small Business Committee Document Number 115-015
              Available via the GPO Website: www.fdsys.gov
                   
                   
 			      __________
                               

                    U.S. GOVERNMENT PUBLISHING OFFICE                    
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                   HOUSE COMMITTEE ON SMALL BUSINESS

                      STEVE CHABOT, Ohio, Chairman
                            STEVE KING, Iowa
                      BLAINE LUETKEMEYER, Missouri
                          DAVE BRAT, Virginia
             AUMUA AMATA COLEMAN RADEWAGEN, American Samoa
                        STEVE KNIGHT, California
                        TRENT KELLY, Mississippi
                             ROD BLUM, Iowa
                         JAMES COMER, Kentucky
                 JENNIFFER GONZALEZ-COLON, Puerto Rico
                          DON BACON, Nebraska
                    BRIAN FITZPATRICK, Pennsylvania
                         ROGER MARSHALL, Kansas
                                 VACANT
               NYDIA VELAZQUEZ, New York, Ranking Member
                       DWIGHT EVANS, Pennsylvania
                       STEPHANIE MURPHY, Florida
                        AL LAWSON, JR., Florida
                         YVETTE CLARK, New York
                          JUDY CHU, California
                       ALMA ADAMS, North Carolina
                      ADRIANO ESPAILLAT, New York
                        BRAD SCHNEIDER, Illinois
                                 VACANT

                   Kevin Fitzpatrick, Staff Director
          Jan Oliver, Deputy Staff Director and Chief Counsel
                Adam Minehardt, Minority Staff Director
                            
                            
                            C O N T E N T S

                           OPENING STATEMENTS

                                                                   Page
Hon. Steve Chabot................................................     1
Hon. Nydia Velazquez.............................................     2

                                WITNESS

Hon. J. Russell George, Inspector General, Treasury Inspector 
  General for Tax Administration, Washington, DC.................     3

                                APPENDIX

Prepared Statement:
    Hon. J. Russell George, Inspector General, Treasury Inspector 
      General for Tax Administration, Washington, DC.............    20
Questions for the Record:
    None.
Answers for the Record:
    None.
Additional Material for the Record:
    None.

 
     SCAM SPOTTING: CAN THE IRS EFFECTIVELY PROTECT SMALL BUSINESS 
                              INFORMATION?

                              ----------                              

                        THURSDAY, APRIL 6, 2017

                  House of Representatives,
               Committee on Small Business,
                                                    Washington, DC.
    The Committee met, pursuant to call, at 10:00 a.m., in Room 
2360, Rayburn House Office Building, Hon. Steve Chabot 
[chairman of the Committee] presiding.
    Present: Representatives Chabot, Radewagen, Kelly, 
Gonzalez-Colon, Bacon, Fitzpatrick, Marshall, Velazquez, 
Murphy, Lawson, Clarke, Espaillat, and Schneider.
    Chairman CHABOT. The Committee will come to order.
    We have votes we think approximately 15 to 20 minutes from 
now. So, and the ranking member will be here shortly. We both 
spoke on the floor and we understand that she will be here in a 
few minutes. So I am going to go ahead and give my opening 
statement now.
    I cleared it with my colleagues on the other side of the 
aisle to make sure I took out all my attacks on Nydia in my 
opening statement because she was not here to defend herself. 
So, and I am just kidding, obviously, for those who may take 
that seriously.
    So good morning. We thank everyone for being here. A 
special thanks to our witness, the Honorable J. Russell George, 
who is taking time away from his busy schedule to be here with 
us today.
    As tax season heats up, so, too, does tax fraud season. In 
testimony before this Committee last year, IRS Commissioner 
John Koskinen reported that a cyber breach had exposed taxpayer 
data from over 700,000 accounts. Commissioner Koskinen also 
told us that IRS computer systems are under constant attack 
from would-be hackers to the tune of 1 million attempted 
cyberattacks per day. A million cyberattacks every single day. 
Criminals are becoming ever more sophisticated and ruthless in 
the ways that they can make attacks on identity theft and file 
fraudulent returns with ill-gotten personal information.
    At a minimum, the goal of the IRS must be to make this 
crime harder, not easier, for identity thieves to commit. 
Identity theft is growing at a truly alarming rate. According 
to the most recent figures from the Bureau of Justice 
Statistics, more than 17.6 million Americans, including 2.6 
million seniors, fell victim to this terrible crime in 2014. 
Seniors are attractive targets for identity thieves because 
they are more likely to have life savings, own their own home, 
and have good credit. All of us on this Committee have heard 
heartbreaking stories from our constituents, especially 
seniors, who have been victimized by this crime. Identity theft 
does not just rob its victims of their money and their credit; 
it robs them of their sense of security and peace of mind.
    As we have heard in previous hearings, most recently our 
series on small business cybersecurity, too often small 
businesses are targeted for this type of cybercrime because 
they often lack the resources to protect themselves. It has 
become clear that the IRS, like all agencies trusted with the 
American people's most sensitive personal information needs to 
step up its game. While the IRS may have taken a few limited 
steps in the right direction, there are countless additional 
steps that must be taken to ensure taxpayer information is 
adequately protected. To be clear, this is not an issue of 
funding at the IRS; it is an issue of priorities at the IRS. If 
the IRS can pay out big bonuses to its employees, some of whom 
were implicated in the targeting of Americans for their 
political views, it should be able to find the money to protect 
people's data from identity thieves. If the IRS can pay for its 
employees to travel to new training events and prioritize the 
enforcement of Obamacare over basic customer service, then 
there really is no excuse for failing to protect taxpayer 
information from thieves.
    Our witness today is charged with periodically evaluating 
the IRS's efforts to safeguard taxpayers' personal information, 
including those of small businesses. It is my hope that he will 
shed light on the specific systems and procedures currently in 
place at the IRS and make recommendations for improvement going 
forward.
    I look forward to hearing from our witness, Inspector 
General George, this morning, and I will yield to the ranking 
member when she gets here, which we understand will be very 
soon.
    The ranking member is recognized for 5 minutes.
    Ms. VELAZQUEZ. Thank you, Chairman.
    It is the first week of April and that means tax day is 
right around the corner. Over the next few weeks, millions of 
Americans will be trying to get their taxes filed on time. But 
this time of year also brings out criminals who target 
individual taxpayers, business owners, and tax preparers. In 
recent years, thousands of people have lost millions of dollars 
and their personal information to tax scams and fake IRS 
communication. The Association of certified 5 Fraud Examiners 
found that a typical organization loses an average of 5 percent 
of revenues each year due to fraud, translating to $3.7 
trillion total. And although we typically hear of scams 
targeting individual taxpayers via phishing emails and phone 
calls, small businesses are actually more vulnerable. Whether 
it is a lack of awareness of cybercriminals, small firms and 
their tax preparers are increasingly becoming the focus of 
identity theft. Small business owners are already hampered by 
complying costs and the worry about data security adds an 
additional layer to that complexity.
    Identity theft and the refunds claimed from it has become 
an increasing problem the IRS is battling to address. In fact, 
the agency said it rejected 1.8 million fraudulent returns 
filed in 2014 worth $22.5 billion in refunds. Unfortunately, 
the IRS also paid out approximately $3.1 billion in fraudulent 
returns.
    Not only must the IRS protect itself from fraud; they are 
also tasked with alerting taxpayers to popular tax scams. Every 
year the IRS releases its ``daily dozen,'' a list of scams from 
phishing, phone scams, preparer fraud, and employer 
noncompliance schemes. In addition to publications, the IRS 
took steps to bring all stakeholders to the table for their 
Security Summit Initiative, a public-private partnership to 
amplify security risks and design new and innovative 
safeguards. The summit has led to a more active role by 
taxpayers to protecting their personal financial information.
    While this is a step in the right direction, more must be 
done to address the needs of small business taxpayers and their 
battle against criminals.
    Today's hearing will give us the chance to hear from the 
Treasury Inspector General for Tax Administration about how the 
IRS is educating, mitigating, and preventing scams for a small 
business customer. I hope we can take a lesson from the 
audience performed by TIGTA and develop multi-tiered approaches 
to combat identity theft and other scams harming our nation's 
small businesses.
    With that, I welcome the gentleman for taking time to share 
his insights and help us seek solutions to this issue. Thank 
you.
    Mr. Chairman, I yield back.
    Chairman CHABOT. Thank you very much. The gentlelady yields 
back.
    It is a close call, but I am inclined since we have got a 
fair number of members here to let you testify now. If members 
have to leave to vote, you know, the first vote is open longer.
    So, and I am going to forgo the explanation of your 
distinguished background. The gentleman before us today, of 
course, is Inspector General for Tax Administration, and you 
are recognized for 5 minutes, sir.

    STATEMENT OF THE HONORABLE J. RUSSELL GEORGE, INSPECTOR 
   GENERAL, TREASURY INSPECTOR GENERAL FOR TAX ADMINISTRATION

    Mr. GEORGE. Thank you, Chairman Chabot, Ranking Member 
Velazquez, members of the Committee. Thank you for the 
opportunity to testify on scams and their impact on individuals 
and the business taxpayers.
    Can the IRS protect taxpayer information? That is the 
primary premise of this hearing. Our ongoing work shows that 
the IRS is making progress. However, tax scams are constantly 
evolving, which will require the IRS to continually adapt its 
detection and prevention processes.
    Since May 2012, my office has issued a number of reports 
that address the IRS's efforts to detect and prevent the filing 
of fraudulent individual and business tax returns by identity 
thieves, as well as the IRS's efforts to assist victims.
    Identity theft refund fraud occurs when an individual uses 
another person's or our businesses name and taxpayer 
identification number to file a fraudulent tax return for the 
purpose of receiving a tax refund. For example, identity 
thieves file fraudulent business tax returns using the employee 
identification numbers of active or inactive businesses. Most 
recently, we reported in February 2017, that IRS efforts are 
resulting in improved detection of identity theft of individual 
tax returns before fraudulent tax refunds are released. 
Beginning with the 2017 filing season, the IRS now has more 
timely access to third-party income and withholding information 
to compare against tax returns while processing these returns. 
Previously, the IRS did not have this information early enough 
in the filing season which had prevented it from making 
substantial improvements in its fraud detection efforts. Access 
to this information at the beginning of the filing season is 
the single most important tool to detect and prevent tax fraud 
related identity theft.
    As I stated earlier, the IRS recognizes that new identity 
theft patterns are constantly evolving. As such, the IRS needs 
to continually adapt its fraud prevention processes. In 
September 2015, we reported that the IRS recognized a growing 
threat of business-related identity theft, and in response was 
implementing the processes to detect identity theft on business 
returns. However, TIGTA found that the IRS is not using data 
that it has readily available to proactively identify business 
identity theft. In response to TIGTA's recommendations, the IRS 
is expanding its detection filters to identify business 
identity theft. For the 2017 filing season, the IRS is using 25 
filters to identify potentially fraudulent business tax returns 
and prevent the issue of fraudulent tax refunds.
    Individuals can also be victims of employment-related 
identity theft which occurs when a taxpayer's stolen identity 
is used to gain employment. This can cause a significant burden 
due to the incorrect computation of taxes and Social Security 
benefits based on income that does not belong to the taxpayer. 
In August 2016, we reported that during the period February 
2011 to December 2015, the IRS identified almost 1.1 million 
taxpayers who were victims of employment-related identity 
theft, but were not notified. In January 2017, the IRS began 
notifying victims. In addition, our ongoing audit found that 
the IRS's processes are not sufficient to identify all 
employment-related identity theft victims.
    Finally, TIGTA has reported that the IRS is not effectively 
providing assistance to taxpayers who report that they have 
been victims of identity theft, resulting in an increased 
burden for those victims. In July 2015, the IRS created a 
centralized unit to combine the skills of employees working 
identity theft cases and multiple functions into one 
directorate. This has resulted in improvements in case closure 
timeframes and a reduction in case closing errors. To help 
protect identity theft victims and improve authentication, the 
IRS began using unique identification numbers for victims in 
fiscal year 2011. This number helps the IRS verify a victim's 
identity when their tax return is filed so that the processing 
of the return and the refund is not delayed. However, TIGTA has 
identified that victims of identity theft tax accounts were not 
always consistently updated to ensure that these identification 
numbers were generated as required.
    Identity theft imposes significant financial and emotional 
hardship on individuals and businesses.
    Chairman CHABOT. Excuse me, General, I am going to ask if 
you would suspend at this time. I think what we should do is go 
over and vote and then we will let you continue when we come 
back.
    Mr. GEORGE. Mr. Chairman, that is fine. I am effectively 
done, so.
    Chairman CHABOT. Okay. We will be back. We have two votes. 
Since this vote is almost through we should be back, I am 
guessing, in 20 minutes or so, 25 minutes at the most, I think.
    Mr. GEORGE. Very good, sir.
    Chairman CHABOT. So we are in recess until we come back 
after votes.
    [Recess]
    Chairman CHABOT. I note for the record that the ranking 
member did beat me back here today.
    We will go ahead and continue. And General, if you had any 
concluding remarks there, or you could take up where you left 
off if you would like?
    Mr. GEORGE. I have one additional paragraph, Mr. Chairman.
    Chairman CHABOT. Okay.
    Mr. GEORGE. And so suffice it to say, identify theft often 
imposes significant financial and emotional hardships on 
individuals and businesses. We at TIGTA remain concerned about 
these attempts to defraud taxpayers through identity theft and 
other scams. We will continue to review the IRS's efforts to 
prevent tax-related identity theft and investigate any 
instances of attempts to corrupt or otherwise interfere with 
the Nation's system of tax administration. Thank you.
    Chairman CHABOT. Thank you very much. And now members will 
have 5 minutes. I am not sure how many members we will have 
actually come back because once votes are over for the week we 
tend to scurry to all parts of this great Nation.
    Ms. VELAZQUEZ. And a storm.
    Chairman CHABOT. Yeah, and there is a storm going on.
    Mr. GEORGE. That is true, too.
    Chairman CHABOT. So, you know, planes, and I think people 
are heading for the airport, including myself and the ranking 
member probably in the near future.
    So I will recognize myself for 5 minutes.
    First of all, you mentioned the State Suspicious Filer 
Exchange Initiative in both your September 2015 and February 
2017 reports. How many States are now participating? And has 
this program been expanded to business filers as you 
recommended back in 2015?
    Mr. GEORGE. As of January 1st, 43 States now participate in 
the program. IRS now includes business tax filings in the 
information shared with State tax agencies. Again, of the 43 
States that participate, 33 have elected to receive confirmed 
business identity theft/fraud information from the Internal 
Revenue Service.
    Chairman CHABOT. Thank you. In your testimony, you noted 
that the Consolidated Appropriations Act of 2014 requires the 
IRS to issue a notice to an employer requesting an address 
change to make employers aware in case the request was 
unauthorized. What process did the IRS use prior to that time 
to confirm that an address change request was authorized, if 
any?
    Mr. GEORGE. Sir, it was surreal. First of all, we are not 
aware of any prior processes, formal processes that the IRS 
used prior, or at least proactively to confirm address changes, 
but the perverse part of all of this, sir, was that in many 
respects, the IRS was communicating with people who were, in 
effect, identity thieves. So if someone used a legitimate 
taxpayer's address or name and taxpayer identification number 
and then used an address for themselves, in effect, a fake 
address, the IRS could communicate with the fraudster, the 
criminal. And the legitimate taxpayer was left in the dark.
    Chairman CHABOT. Thank you very much.
    With regard to the telephone impersonation scam, you 
mentioned the advise-and-disrupt strategy that you are using to 
flood reported telephone numbers with automated calls. However, 
you also noted that these scammers often generate a fake number 
for the caller ID. How effective is this program if most of the 
phone numbers the intended victims see are not the numbers from 
which the calls originate? And has this strategy ever resulted 
in calling some innocent person's phone line over and over 
again?
    Mr. GEORGE. Yeah, this has been one of the biggest 
challenges to the IRS in this modern age, sir. A lot of the 
crooks are using VoiceOver internet protocols which allow them 
to fake ID caller ID information on people's telephone numbers. 
We have been effective in a number of ways in terms of 
addressing this.
    One, we have put out the word, and that is something that I 
wanted to ask all members of this Committee and every member of 
Congress if they could help us in terms of your communications 
with your constituents, please put out the word about this. 
Knowledge is the most powerful, I think, tool that anyone can 
have in terms of addressing this overall issue so that people--
my late mother used to, because this first occurred while she 
was still alive, she would say to me, ``Russell, I got this 
call. I hung up on them.'' And she was so proud of that. I 
mean, she was emphatic about, ``I hung up on them.'' And I 
said, ``Mom, that is the right thing to do.''
    But what we have done, two things. We have established on 
the web a listing of telephone numbers that we are aware of 
where many of these calls are emanating from so that a taxpayer 
or someone who suspects that they were approached by criminals 
can input the telephone number and see that, yes, we have 
identified this as a false number. Two, we have called back a 
lot of these numbers and in effect said to the people who 
answered, ``Hey, we are aware of what you are doing. Cease and 
desist.'' And three, we have also attempted to work with some 
of the telecommunications companies to help put these numbers 
out of service.
    Chairman CHABOT. Thank you very much. My time is almost 
expired so rather than go into it and go over, I am going to go 
ahead at this time and recognize the ranking member for 5 
minutes to ask questions.
    Ms. VELAZQUEZ. Thank you, Mr. Chairman.
    Many small business taxpayers are not aware of identity 
theft until it is too late. What would you suggest is the best 
way for the IRS to reach out to businesses to educate them on 
identity theft and how to protect themselves?
    Mr. GEORGE. Great question, Ranking Member Velazquez.
    One, the IRS has taken efforts. They recently convened a 
group of private sector organizations to help, one, inform them 
of the problem, and two, to enlist their assistance in both 
becoming aware of the problem further, but to help educate once 
again those who are potentially the victims.
    Ms. VELAZQUEZ. Okay. So do you believe that the Small 
Business Administration has a role to play assisting the IRS? 
And are you aware if such collaboration exists?
    Mr. GEORGE. You know, that is outside of my area of 
expertise, but yes, my thinking is and my recommendation is 
that the Small Business Administration should play an active 
role in this.
    Ms. VELAZQUEZ. In fiscal year 2016, Congress appropriated 
an additional $290 million to the IRS for key areas that 
directly support taxpayers, including increasing telephone 
Level of Service, cybersecurity activities, and identity theft 
prevention and refund fraud mitigation activities. Do you 
believe this additional increase was sufficient for the IRS to 
carry out its duty to protect small businesses?
    Mr. GEORGE. It was of assistance, yes. Now, the vast 
majority of that additional funding was used to increase the 
level of service that the Internal Revenue Service provides to 
taxpayers by way of its toll-free telephone number, which is 
extraordinarily important, especially during the tax filing 
season. But at the same time, if given additional resources, 
the IRS is able to do additional work.
    Ms. VELAZQUEZ. Thank you. We often hear about tax scams 
during this time of the year, but what we do not realize is 
that small businesses are considered good targets by the scam 
artists. In order to be adequately prepared, what is the best 
practice for a small business owner when they encounter such a 
scheme?
    Mr. GEORGE. To, one, again, knowledge is power. You have 
heard that in various areas of your lives, but it is so true in 
this regard. Two, I mean, use common sense. I mean, just as you 
as an individual hopefully check your bank statements, 
businesses need to do so, also. Three, you cannot rely on the 
CFO necessarily alone, especially if you outsource. You have to 
be actively engaged here. And four, in all candor, I mean, 
there is too much reliance on assuming that electronic systems 
of accounting for your work will watch out for you and be in 
your best interest. You know, you have to be proactive. You 
have to ensure that you take the steps necessary to ensure that 
you safeguard your business and your employees.
    Ms. VELAZQUEZ. Okay, thank you. In your written testimony 
you indicate that the IRS uses 197 identity filters for 
individual returns and 25 filters for business tax returns, and 
these are used to identify potential fraudulent tax returns. I 
know business tax returns are different, but do you think 25 
filters is enough for a business tax return?
    Mr. GEORGE. You know, I hesitate, Ms. Velazquez, to 
elaborate too much on the number of filters and how the IRS is 
going about doing this only because I do not want to give a 
roadmap to the perpetrators of this.
    Ms. VELAZQUEZ. Sure. Okay.
    Mr. GEORGE. The bottom line is the IRS, and I give them a 
lot of credit, they are being proactive in this regard to help 
produce processes to identify this area. In addition, it is 
important that we note, and I am not just wanting to give 
credit to my auditors and my investigators, you know, the IRS 
really did not have a great grasp of the magnitude of the 
problem. First of all, we brought it to their attention, and 
they did work on their own, also, I am not taking anything away 
from them, of the individual tax fraud problems. And then we 
followed up with the business tax-related problems, fraud-
related problems. So they really did not have their arms around 
this. We have outstanding work that we are doing that we hope 
to complete in the not too distant future which will assist 
them further in this regard.
    Ms. VELAZQUEZ. Thank you.
    Chairman CHABOT. Thank you.
    Ms. VELAZQUEZ. I yield back.
    Chairman CHABOT. Thank you. The gentlelady yields back. Her 
time is expired.
    And the gentleman from Kansas is recognized for 5 minutes.
    Mr. MARSHALL. Mr. Chairman, can you get back to me in 30 
seconds, after the next person?
    Chairman CHABOT. I would be happy to do that. We are going 
to go into a second round at this point, so I will go to myself 
if that is okay and give you a little time there.
    General, the report you released earlier this week 
contained some very disturbing findings, particularly for small 
businesses. You mentioned that in October 2014, IRS Criminal 
Investigations, CI, instituted a policy that it would no longer 
pursue seizure and forfeiture of funds from legal sources that 
merely appeared to have been structured. However, you found 
that most of the seizures for structuring involved legally 
obtained funds while the intent of the statute is to pursue 
illegal activity. This is really important for small businesses 
because, based on their size, they are likely to make bank 
deposits in frequent intervals of less than $10,000. If CI is 
not following its own policy in this regard, what do you 
recommend to ensure that innocent small business owners are not 
unfairly targeted?
    Mr. GEORGE. Thank you for that question, Mr. Chairman. This 
is the first time I have had a chance to speak publicly about 
this extraordinarily troubling situation. We discovered over 91 
percent of the seizures were of a legal source of income. And 
again, just for the benefit of those who may not be familiar 
with the overall issue, there is a Federal statute that 
requires financial institutions to report transactions in 
excess of $10,000 to the appropriate government agency.
    And what the Internal Revenue Service was doing in the 
meanwhile is a lot of bad people would structure, meaning 
transfer $7,000 and then $3,000, which if they had done the 
$10,000 transfer would have spurred the reporting requirement. 
But by breaking it up, otherwise saying structuring, they were 
able to avoid that. And so the IRS Criminal Investigation 
Division had a system established so that they spotted these 
unusual tactics.
    Now, in an ideal world, perfect if it were to work that way 
because, in all candor, a lot of people who engage in illegal 
behavior do try to avoid the reporting requirement by doing 
that. But again, our report showed that of the vast majority of 
the people who were being caught up by the IRS's Criminal 
Investigations Division processes were not engaged in criminal 
behavior, and the most troubling aspect of this is they were 
having a very difficult time either getting their money back 
because the IRS was allowed to seize that money, to forfeit it. 
So then the burden of proof was shifted to the innocent 
taxpayer, and in many instances that money was never returned 
to the innocent taxpayer. So the IRS has now stopped that 
practice. We hope through this report, and again, the actions 
of members of Congress, people will, one, seek to get their 
money back and, two, that the IRS never again engages in this 
type of behavior. This is very troubling, sir.
    Chairman CHABOT. Thank you very much. I am glad you had the 
opportunity to clear that up because it is really unfair to a 
lot of small businesses that have been caught up in that.
    In the short time I have remaining, let me ask you this. I 
had an opportunity during votes to talk with my Democratic 
colleague from Illinois, Brad Schneider, and he had a 
suggestion which I would like to raise at this point if I can. 
He said he is all the time getting notices that somebody has 
logged in under your name at such and such, and it is him, and 
I have had this happen to me. I am sure a lot of the folks in 
this room have as well. So in this area about somebody else 
filing a tax return and it is not you, and by the time you file 
yours you find out somebody else already fraudulently did that 
and got a return and then maybe you can get it cleared up. You 
ultimately get your money, but it is going to be slower and it 
is a hassle to go through this. Why not when a taxpayer files 
his or her return, why not have the IRS immediately send back a 
notice to them saying, hey, thanks, we just got your return? 
Because then you know that it happened. What about that?
    Mr. GEORGE. Well, in theory that does occur, especially if 
you use some of those tax preparation software where literally 
they say to you the moment you file your return, check back 
within 24 hours to confirm that the IRS received your return 
and that everything is fine. So what was extraordinarily 
troubling, Mr. Chairman, is when the IRS would say, you know, 
our advice to you is to file early so that you beat the bad guy 
before he or she files a return in your name. So, but in terms 
of paper returns that was not the case in terms of paper 
returns. That, what you are suggesting, was not happening, and 
I do not believe it is happening.
    Chairman CHABOT. I thought Mr. Schneider had a great idea 
so I am going to ask probably staff on both sides to maybe look 
into this and see if there is not some way we can put this into 
effect, maybe save a lot of people a lot of heartache.
    My time is expired, so we will now recognize the gentlelady 
from Florida, Ms. Murphy, who is the Subcommittee ranking 
member on Contracting and Workforce, for 5 minutes.
    Ms. MURPHY. Great. Thank you so much for being here and for 
your testimony.
    Mr. GEORGE. Good morning.
    Ms. MURPHY. Efiling has become more prevalent, but so has 
identity theft and refund fraud which we talked a little bit 
about here. TIGTA has been actively involved in working with 
the IRS to find solutions to combat this fraud. In your 
opinion, is the IRS doing enough with the stakeholder community 
to prevent that identity theft?
    Mr. GEORGE. They are doing, candidly, as much as they can 
given the resources that they have. Over the last few years, as 
you may be aware, the IRS's budget has been cut dramatically 
and their responsibilities have been increased dramatically 
given the ACA and the role that they have to play with that. 
Could they do more? Yes, but it is almost--I am trying to think 
of a right metaphor here, but the bottom line is if they do 
more in this area, they have to do less in this area.
    Ms. MURPHY. So you are saying that they do not really 
prioritize protection against identity theft against the other 
responsibilities that they have?
    Mr. GEORGE. Well, during the filing season their goal is, 
to the extent that they can, is to ensure that taxpayers who 
either reach them by phone, which again is an issue because of 
reduced resources, or who go to Taxpayer Assistance Centers, or 
have the ability to get questions answered. And yet, until 
they--and again, during my opening statement I made reference 
to a new directorate that the IRS created which is dedicated to 
helping victims of tax-fraud related identity.
    Prior to that they used to have those same individuals who 
would normally handle those types of cases, one, answer the 
telephone for people who had basic tax questions and, two, 
those types of cases were assigned to random IRS officials. 
There was no dedicated person for the taxpayer to reach out to 
as you may find in the private sector where if you have a 
problem with a credit card, it is Ms. Jones or Mr. Jones whose 
extension is given to you and that is the person you would 
reach out to. So that is changing for the better, but again, 
the bottom line is more resources would help the IRS in this 
area.
    And as I pointed out earlier, the tax cheaters, they are a 
very, you know, flexible sort. They change their means. They 
are located across the globe. This is truly a challenge for not 
only the IRS, but in this obvious instance we are referring to 
them.
    Ms. MURPHY. And then to just dig into the part that you 
talked a little bit about, trying to streamline a bit of the 
processing of the fraudulent cases, you know, for small 
businesses it is really critical for them to have timely 
processing of their refunds, and they operate on such slim 
margins. What else do you think TIGTA can do to ensure that 
small firms are not hindered by the fraud prevention efforts?
    Mr. GEORGE. Information. Getting the word out. Again, I 
mentioned that earlier. It is so important, and this is a group 
effort. At TIGTA, we have done it through television interviews 
and media releases. I do not know if you have this at your 
local pharmacy, but I saw at my pharmacy where the inspector 
general of the Department of Health and Human Services says--
there was a sticker from him that said if you encounter fraud, 
if something suspicious is occurring, you know, call us. We 
have done the same at TIGTA now, and it is effective in that we 
get the word out. If you suspect someone is cheating you 
because of a telephone impersonation scam or any other type of 
criminal wrongdoing, call us at our 800 number, email us, and 
that is how we get a lot of the leads that we pursue.
    Ms. MURPHY. Great. Thank you very much. And I will yield 
back the remainder of my time.
    Chairman CHABOT. Thank you. The gentlelady yields back.
    The gentleman from Kansas, Dr. Marshall, is recognized for 
5 minutes.
    Mr. MARSHALL. Thank you, Mr. Chairman.
    I guess my first question has to do with cybersecurity in 
the sense of, in this case, identity theft. I think it is 
probably the same bucket of problems. I go to the Science and 
Space Technology Committee meeting and we talk about healthcare 
records being attacked, and I am sure if I was on a military 
committee we would be talking about it. What type of 
communications are we doing between the different agencies to 
work with each other? Is there one particular group of people 
that is really, really studying this problem hard and fast and 
trying to disseminate that information to let you do your job 
better, I guess?
    Mr. GEORGE. You know, that is a very good question, Dr. 
Marshall. The problem that the IRS encounters is the Tax Code. 
Title 26, Section 6103 of the United States Code places severe 
restrictions on the type of information that the IRS can share 
with anyone, and these include criminal penalties. So 
literally, I cannot tell you about a particular constituent's 
tax information without--my lawyer is here--without risking 
prosecution. So being specific regarding that in terms of an 
individual's case, I mean, a taxpayer can sign a waiver to 
allow you as the congressman or representative or someone, a 
lawyer or an accountant, to represent them on their behalf. At 
last, there are efforts, government-wide, obviously, to look at 
cybersecurity threats. And in a couple of instances, again, as 
it related to the Affordable Care Act, where we and HHS-OIG 
were able to work together because of the overlapping role that 
we both played in that area.
    Mr. MARSHALL. Yeah, and it seems like the privacy issues 
are backfiring. People give oversight to commodities. When one 
commodity system gets hacked, they are not allowed to share 
with their brethren that there has been a hack and prevent the 
next person. I do not have a solution, but at least I am trying 
to recognize the problem.
    I think I am going to change the direction a little bit. 
If, indeed, we could get the majority of taxpayers to be able 
to file their income tax on a postcard, how would that help 
free up your life or make your life better or worse?
    Mr. GEORGE. Candidly, I think you would have some of these 
scammers produce postcards or addresses and say send that 
information or that remittance or what have you to this address 
versus the official. It would help the taxpayer in terms of 
complying. That has been my position ever since holding this 
job, sir. Make the ability to comply with the tax burden as 
simple as possible and most likely you are going to get an 
increase in tax compliance and revenue owed to the U.S.
    Now, technically, that is a tax policy question, and ever 
since the Reagan administration, sir, the Secretary of the 
Treasury has indicated that it is the assistant to the 
secretary for Tax Policy who speaks on it. But given the way 
you phrase it, I feel comfortable with the answer that I gave.
    Mr. MARSHALL. Are you given a chance to make suggestions 
how to make it simpler?
    Mr. GEORGE. That is tax policy, so. The short answer, 
though, is yes, if we say--and this was the case with the 
First-Time Homebuyers credit that you may recall from the 
Reinvestment Act, the forms were such that people were able to 
bypass some legal requirements that they would otherwise be 
required to comply with. So when we identified the problems 
with the forms--and these were basic issues like how much money 
is a property worth, something along those lines, which 
ultimately affects how much money they would have to pay back 
every year--we were able to make the suggestion which the IRS 
did adopt, which made it more efficient.
    Mr. MARSHALL. Okay. I will try to slip in one last question 
here. My constituents talk about wanting a kinder, gentler IRS, 
and I think of the fire marshal who comes by and he gives us a 
list of things to fix and if we get it fixed within 30 days we 
are okay. Do you feel like in the past several years you are 
kind of going in that direction? Is there more room to grow, or 
what are you doing from that standpoint?
    Mr. GEORGE. Yes, I think there is. And again, and I did not 
bring, I normally keep it in my pocket, but third-party 
information. If a taxpayer knows that the money that he or she 
is being taxed on is reported by a third party, the compliance 
rate, meaning the amount of money in taxes that they pay, is in 
the upper 90 percent. And I am just going to cut to the other 
end. The same statistics, and they are somewhat dated, but the 
bottom line is people who engaged in all-cash transactions, the 
tax compliance rate was near 20 percent, you know, 20, 30 
percent. So having third-party information, and thanks to 
Congress recently passing a law that requires the IRS to 
receive information prior to processing tax returns, that is 
extraordinarily helpful in terms of compliance.
    Chairman CHABOT. The gentleman's time is expired.
    Mr. MARSHALL. Thank you. I yield.
    Chairman CHABOT. Thank you.
    The gentleman from Florida, Mr. Lawson, who is the ranking 
member of the Subcommittee on Health and Technology, is 
recognized for 5 minutes.
    Mr. LAWSON. Thank you very much, Mr. Chairman. And welcome 
to the Committee.
    Mr. GEORGE. Good morning, sir.
    Mr. LAWSON. For several years the IRS has been criticized 
for lack of efficiency. Can you speak to the budget issue that 
would probably make the IRS operate more efficient? I do not 
know whether you can speak to that issue or not, but early on I 
just heard you say cuts in the budget caused some restraints on 
what you could do.
    Mr. GEORGE. You are correct on both accounts, sir. I am not 
in a position, because the President's budget has not been 
formally released, to address the impact of whatever the 
current administration is going to ultimately propose for the 
IRS formally. But the bottom line is with additional resources, 
the IRS could do more, there is no question. And again, many of 
the reports that my office has issued during my tenure did in 
the past show a waste on the part of the IRS with conferences 
and with videos and the like, and bonuses to people, which were 
not a good use of the taxpayers money.
    But at the same time, for the most part, the IRS is really 
down. They used to be at least 100,000, an equivalent, you 
know, the FTE number of employees that they had, and they are 
now in the 80,000 range. Now, they have been able to automate a 
lot of things, and they have collected a record amount of tax 
revenue over the last few years, but in terms of the amount of 
customer service, in terms of the amount of time someone has to 
wait to speak to an IRS employee over the telephone, those 
numbers have also increased in a way that I think is 
unacceptable. But otherwise, I am going to have to stop there 
in terms of the impact of the current budget because we do not 
have the formal number.
    Mr. LAWSON. Okay. I understand.
    I hear commercials on the radio all the time, if your debt 
exceeds $10,000, give us a call and we will get the IRS, put 
them in place, and reduce this down. And people pay money to do 
that. How does that work? I mean, do they have a special inside 
track with the IRS than the average person that are running 
these commercials?
    Mr. GEORGE. You know, sir, you really touched on something 
that is important, but, you know, I have got to be careful here 
because it also touches on tax policy, but also with Dr. 
Marshall, if you make it as easy as possible for people to 
comply with their tax obligations, they are going to do so. And 
there is an interesting statistic, but I want to get right to 
your point. That commercial is advertising a service that an 
individual could do by him or herself. So you can reach out. It 
is Offer in Compromise. You could call the IRS and do it 
yourself. However, as like a lawyer, sometimes it is better to 
have an expert who has experience to do it for you, whether it 
is for time reasons or just out of convenience.
    So yes, I have seen that. I do not know how much they 
charge. I have not had a need to take advantage of that, 
fortunately, but the bottom line is, again, it is a matter of 
convenience. And there are some people who are in dire straits, 
but there is no question the IRS is willing to work with 
taxpayers. And so it is not criminal. It is not criminal for 
these businesses to engage in this, but, again, too many 
taxpayers do not realize they do not need to do that. They can 
do it themselves.
    Mr. LAWSON. Another quick question I am going to try to get 
in. When people have gone delinquent for maybe 3 years and the 
interest rates that you all charge, do you all work with them 
on reducing the interest rate so that you all can get the 
amount of money that you need from the tax return?
    Mr. GEORGE. No, that is the IRS. Just to make sure we are 
clear. The inspector general, we are separate. We are not part 
of the IRS. We are part of the Department of the Treasury 
overseeing the IRS.
    Mr. LAWSON. Okay.
    Mr. GEORGE. And so I am not very familiar with the amount 
of interest that they charge, but I do know, in all candor, the 
IRS is flexible as it relates to any past due debt. They would 
rather that people who owe money pay money than someone not pay 
it. And you are right, many times the interest can exceed the 
initial amount owed.
    Chairman CHABOT. The gentleman's time----
    Mr. LAWSON. I yield back, Mr. Chairman.
    Chairman CHABOT. Thank you. The gentleman's time is 
expired. And I would compliment the gentleman on an excellent 
question on the $10,000. I have heard those ads many times. I 
sort of wondered the same thing. Fortunately, as the general, I 
have not been in that position so I have not needed those 
services, but I thought about that. And I would assume that the 
$10,000 they are saying is because the company, they say if 
your debt is more than $10,000, because they do not want to 
mess around with folks that are below that so they are trying 
to make more money by hitting folks that have bigger debts. 
Would that be--there is no magic in $10,000?
    Mr. GEORGE. There is no magic in $10,000, and again, I am 
guessing here, but I am almost certain that it depends on the 
amount of money that you owe and the amount of money that you 
ultimately pay will figure into their fee.
    Chairman CHABOT. The IRS does negotiate with people on 
occasion if they think they are in tough financial straits and 
are not going to be able to pay and they are trying to work 
with them. Is that correct?
    Mr. GEORGE. That is my understanding.
    Chairman CHABOT. So if you ever want to use services, 
perhaps they do so much of it they sort of know how to, for 
lack of a better term, work the system, and maybe that benefits 
the person, and then again, maybe it does not.
    Mr. GEORGE. That is my understanding, sir.
    Chairman CHABOT. Okay, thank you. Excellent question.
    Chairman CHABOT. The gentlelady from American Samoa, Mrs. 
Radewagen, who is the chairman of the Subcommittee on Health 
and Technology, is recognized for 5 minutes.
    Mrs. RADEWAGEN. Thank you, Chairman Chabot, and Ranking 
Member Velazquez. Inspector General George, welcome. Thank you 
for testifying today.
    American Samoa, like the other States, files taxes with the 
IRS. What resources do you believe that the U.S. Department of 
Treasury and the IRS can provide to U.S. territorial 
governments to protect the identities and information of their 
residents?
    Mr. GEORGE. That crosses, you know, not only the 
territories, but every State and the District of Columbia. It 
has to make sure that the American people have the confidence 
that the information that they provide to the IRS is 
safeguarded. If people lose confidence that the information 
they provide is not going to be cared for, it could undermine 
the overall system of our Nation's tax administration system 
and that could be problematic.
    This is not a direct response to your question, but this is 
something that I was averring to earlier when I was responding 
to an earlier question. A study done by the IRS Tax Oversight 
Board showed that most people would say, literally, again, 
almost approaching 100 percent, that they should pay the taxes 
that they owe when the question was posed to them. But when the 
question was varied slightly and they said, well, your neighbor 
down the block only pays 50 percent of what she owes, then they 
say, well--then what should your requirement be? And the number 
grows from near 100 percent closer to 50 or 60 percent. So when 
people know that everyone is paying what they owe and that the 
IRS is doing what it needs to do, they have confidence. They 
will comply. Again, it also goes to a simplicity of complying.
    Mrs. RADEWAGEN. Thank you. Mr. Chairman, I yield back the 
balance of my time.
    Chairman CHABOT. Thank you very much. The gentlelady yields 
back.
    The gentleman from Nebraska, Mr. Bacon, is recognized for 5 
minutes.
    Mr. BACON. I want to thank the inspector general for being 
here. As a 30-year Air Force veteran, I know the importance of 
the inspector general. And I would like to also say I have been 
a victim of credit card and fake identity, or a combination 
thereof, three different times. One time while deployed to the 
Middle East, a guy took my identity. He was living in a five-
star hotel. My wife caught him and had to fight really hard to 
get him arrested and held accountable.
    But I think Americans are tired of this because so many of 
us have been victims. I would like to ask you, how does the IRS 
work with law enforcement when they finally catch someone 
scamming?
    Mr. GEORGE. Great question. Again, there are hoops that 
have to be jumped through. Again, I made mention of Title 26 of 
the United States Code, it is Section 6103, places severe 
restrictions on the type of information that the IRS can 
proactively share.
    Mr. BACON. With law enforcement?
    Mr. GEORGE. Even to law enforcement. But the individual can 
give the IRS license to release information, and that is 
normally how it is pursued. That is my understanding at least.
    Mr. BACON. Can we pass a bill of some type or legislate, 
making it easier to hold these people accountable?
    Mr. GEORGE. You know, I do not think it is a question of 
legislation in this instance, Congressman. I really do not. 
One, you do have to have a victim who is willing to cooperate 
with law enforcement, as most victims are unless they are 
engaged in somewhat----
    Mr. BACON. Or you have some who have been dead for a while 
and they are using a deceased person. So it is hard to get 
their permission.
    Mr. GEORGE. Well, again, you know, obviously, I would argue 
an estate, you know----
    Mr. BACON. Right.
    Mr. GEORGE.--or someone would on their behalf. So, but 
there is no question it is knowledge, sir.
    Mr. BACON. Right.
    Mr. GEORGE. And that is part of the problem. A lot of 
people, especially seniors, obviously deceased individuals, may 
not have an estate which is large enough to have an executor or 
someone or administrator or someone who is being proactive in 
that regard.
    Mr. BACON. Right.
    Mr. GEORGE. So this is an area, sir, where can you 
eliminate all types of crime?
    Mr. BACON. No, but I would like to put a lot more of them 
in jail.
    Mr. GEORGE. I am with you 100 percent, sir.
    Mr. BACON. So I would love to work with--or us with you and 
as a team to figure out how do we put our brains together 
because I think this is way too rampant. People are getting off 
scot-free, and I think if we put an effort on this--I believe 
in deterrence. Throw more people in jail, maybe less people 
will do it.
    Maybe a parallel question. How do you tackle this when it 
is an overseas scam, say from Nigeria or wherever it may be?
    Mr. GEORGE. Another great question. I am extraordinarily 
proud to give my colleagues, especially on the investigative 
side of my house at TIGTA, a pat on the back. We recently, 
working with the Department of Justice and a few others, 
announced the indictment of a number of firms in India, and 
these were firms--the irony is a lot of those call firms that 
are legitimate, if you call Xerox--not Xerox, but you know, one 
of these telephone or computer companies and you are 
transferred, you do not where they are; many of them are 
located in India. These small call centers where in the morning 
or night, depending on the time of day, you had a segment who 
were answering legitimate questions from consumers, and then we 
found that there was a small division over there who were 
engaged in these telephone scam things. I am calling from the 
IRS. You owe $10,000. You need to pay immediately. You need to 
use an iTunes card. You need to stay on the phone and do this 
while I am talking to you. And you would be surprised, sir, how 
many people fall prey to that, especially senior citizens and 
the like. So, by working with the Indian Government, as well 
as, obviously, Interpol and other law enforcement agencies, we 
were able to obtain indictments. And unfortunately, those 
indictments were here in the U.S., so while there were a number 
of people who were domestic who we were able to arrest, more 
were overseas, and unless they come into the United States--it 
is not just India, too, just to be clear. There are many other 
countries.
    Mr. BACON. I really think your favorable status as an IRS 
would go way up if you start showing some convictions on people 
scamming and doing fake IDs and taking advantage of the 
taxpayers.
    A related question or something that you were talking about 
and you may not be able to speak to it here, I realize when you 
have your funding cut it is very hard to do everything that you 
want to do and that is just a fact of life. And part of that 
was because of the targeting of the conservative and religious 
groups. Are there any investigations within the IG that are 
still working in that realm?
    Mr. GEORGE. The short answer is yes, and we will be 
releasing shortly, in effect, a follow-up report to that 
initial. But I have to once again, Congressman, make it clear, 
I am not part of the IRS.
    Mr. BACON. Okay. Part of the inspector general.
    Mr. GEORGE. I am part of the Treasury. So, and we are the 
ones who identified that problem back in 2013.
    Mr. BACON. Thank you.
    Mr. GEORGE. No, thank you.
    Chairman CHABOT. The gentleman's time is expired.
    The chair is going to suggest that the gentleman, since you 
have had this experience a number of times, I am going to put 
at your disposal the resources of our staff here to see if we 
cannot move forward in conjunction with the witnesses we have 
here today and others to see if we cannot make some progress in 
this area, whether it is legislative or whether it is 
regulatory or whatever it is, there are a lot of people getting 
ripped off for an awful lot of money and I commend the 
gentleman--would the gentleman accept that?
    Mr. BACON. I would love to have that responsibility. Thank 
you, Mr. Chairman.
    I think it is so widespread, Americans want to see 
accountability and people held responsible for doing this. And 
I do not think we see it, so we sense it has happened all 
around us and not enough is being done to counter it.
    Chairman CHABOT. Thank you. And I would note for the record 
that the gentleman is literally a general, you know, a real 
general. You are a real general, too, but I mean a military 
general and is used to ordering people around. So I think he 
will get to the bottom of this.
    Mr. BACON. I appreciate the inspector general in the Air 
Force not having to look my way too often, so.
    Chairman CHABOT. The gentleman's time, as I say, has 
expired.
    The gentleman from Pennsylvania, Mr. Fitzpatrick, is 
recognized for 5 minutes.
    Mr. FITZPATRICK. Thank you, Mr. Chairman and the Ranking 
Member. Thank you, Mr. George, for your time.
    Mr. GEORGE. Good morning.
    Mr. FITZPATRICK. Two questions. Number one, in our region, 
I suspect we are not unique as well, there has been somewhat of 
an uptick in criminal prosecutions by the U.S. Attorney's 
Office surrounding the Earned Income Tax Credit. What we have 
seen in some of the cases are parents selling the tax credits 
for their children; in some cases, disabled children in homes 
having their identities being used for tax credit purposes. Do 
you think that that tax credit in particular is more 
susceptible to fraud than others? And if so, what can we do 
here in Congress to mitigate that risk?
    Mr. GEORGE. That issue, sir, has been so pervasive. Over 20 
years ago, I was a staffer here on Capitol Hill, and it was the 
Government Reform and Oversight Committee at that time. It was 
a Government Management, Information, and Technology 
Subcommittee, and we issued a report on improper payments, and 
the earned income tax--refundable credits in general, but the 
Earned Income Tax Credit in particular was one of the most--I 
do not want to use the word ``wasteful'' because it does have a 
beneficial impact on the part of taxpayers who need it, but it 
is so susceptible to fraud. It was back then in the billions of 
dollars. It is now 20-plus years later in the billions of 
dollars.
    So it is a program that is not--I do not want to say 
effectively overseen, but because it is refundable, meaning 
that someone does not necessarily have to owe taxes in order to 
receive the benefits of it, it is abused. And it is something 
that Congress--we have brought it to Congress' attention many 
times. I have testified I cannot tell you the number of times 
about it and the additional child tax credit, the education tax 
credit. There are so many tax credits that the IRS has not 
effectively overseen in terms of its use. Are they reducing the 
number of improper payments? Yes. But is it to the extent that 
it should be? There should be none. There should be none, but 
there are.
    Mr. FITZPATRICK. In the area of debt collections, it is my 
understanding that private debt collectors are being used now 
by the Treasury Department. Is there a concern that that is 
going to create some confusion, particularly amongst the elder 
population who have been targeted by a lot of these scams?
    Mr. GEORGE. Literally this week, the IRS will be formally 
rolling out this program. The short answer is yes, I think 
there will be confusion. It used to be, literally a week ago, 
my response to this question would have included the IRS will 
never reach out to you or a representative of the IRS would 
never reach out to you proactively. So if someone calls and 
claims to be calling on behalf of the IRS, it is a scam. Hang 
up. Now, that has changed. But the only thing that could 
possibly benefit the overall system is prior to that phone call 
the IRS is to send a letter indicating that their case, your 
tax obligation, has been assigned to a private debt collector 
and do expect a telephone call from someone who is trying to 
collect the amount of money that you owe.
    Now, of course, again, as a former prosecutor, and again, 
having been in this job for a while, I can imagine the bad guys 
will soon catch on to this, and I hesitate to say this 
publicly, but it is what it is, will then now send a letter and 
find some logo and say we are going to call you. And then, of 
course, you know, give them some fake number to use or whatever 
the case might be.
    But this is a challenge for the IRS, sir. There have been a 
couple of iterations of private debt collectors being used by 
the IRS dating back to the 1990s with very mixed success in 
terms of their effectiveness. But it is either this or, in all 
candor, having hundreds of billions of dollars sitting there 
uncollected by the IRS, accruing interest, but ultimately not 
paying, and there is a statute of limitations in effect on how 
long the IRS can avoid collecting money from taxpayers.
    Mr. FITZPATRICK. Thank you. My time is expired. I just want 
to say that I think it goes without saying, but if the Treasury 
Department could just try to be vigilant in staying a step 
ahead because it does create a lot of angst, particularly 
amongst the senior population, and if there is a place that 
they could go, a hotline that people would actually answer 
questions that we could send to our constituents, it would be 
incredibly helpful.
    Mr. GEORGE. And Mr. Chairman, with your indulgence----
    Chairman CHABOT. Go right ahead.
    Mr. GEORGE. Congressman, that is extraordinarily important, 
and I made this point. I do not know if you were in the room at 
the time, it is so important in your mailings to your 
constituents, you know, TIGTA--the Treasury Inspector General 
for Tax Administration, TIGTA--we have a hotline, we have 
websites, we have a telephone number. Please, if in doubt, even 
with the legitimate, call us, call the IRS to confirm. Do not 
fall prey. And too many people, and the amounts of money, 
especially amongst seniors that they are paying in false 
requests, it is troubling.
    Chairman CHABOT. Thank you very much. The gentleman's time 
has expired.
    And we want to thank the inspector general for 
participating today. The IRS faces truly a daunting challenge 
in combating tax identity theft, and this battle is one that we 
must win. It is essentially for the fair and efficient and 
effective functioning of our tax administrative system overall, 
and we appreciate the hard work of General George in overseeing 
the IRS performance and progress in this area. And thank you 
for sharing that today.
    Equally important to the objective evaluation of current 
conduct are your thoughtful recommendations for improvement 
going forward. You play an important role, and we want to thank 
you for being here today to share your insights with us, and we 
hope that we can continue to work together to improve the 
safety and security of our small businesses in particular, but 
individuals on their personal tax forms as well in the tax 
arena as we move forward.
    I would ask unanimous consent that members have 5 
legislative days to submit statements and supporting materials 
for the record. Without objection, so ordered.
    And if there is no further business to come before the 
Committee, we are adjourned. Thank you very much.
    Mr. GEORGE. Thank you, Mr. Chairman.
    [Whereupon, at 11:28 a.m., the Committee was adjourned.]
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