The IRS is not efficiently or effectively processing information referrals, including identity theft claims, the Treasury Inspector General for Tax Administration has said.
After following up on a referral reporting that thousands of identity theft cases reported on Forms 3949-A were not being processed, TIGTA determined that IRS reporting guidelines are confusing and inconsistent and should be changed.
Instructions on Form 3949-A do not explain what types of fraud and tax-law violations to report and individuals often use the form for purposes other than reporting suspected tax fraud or tax law violations, the IG said.
It said the IRS has agreed to revise IRS.gov so taxpayers understand the purpose of the form, review current procedures for necessary changes, and evaluate steps to ensure a more effective quality review process and tracking system.
Finally, the agency plans to ascertain the feasibility of an online Form 3949-A and assess the level of technical expertise required for the needs of the process after considering the effects of the other corrective actions.