Identity theft- it just gets worse

[kathyc2]

My second client this year with a rejected return, just called w/ some interesting information.

They received a check in the amount of 4440 from a Sunrise Bank in CA, but TP lives in Indiana. They got a letter, which incidentally was addressed to both of them, stating it was for their 2014 refund. Also in the letter she said that the refund was for 5,932. It is unknown what happened to the ~ 1,500 difference?

Anyone have a clue what it going on with this? And what to do with the check? I'm assuming the money should go to Treasury rather than Sunrise Bank.

[David1980]

Possibly someone did the return and used a bank product in order to get preparer fees paid out of the refund. The IRS deposits the refund to the temporary bank account, the bank splits it out paying prep fees to preparer and bank fees to bank. Whatever is left over is then issued to taxpayer. So one possibility is a preparer did the identity theft and charged the taxpayer $1,500 or so in preparation fees. Maybe a prior year preparer that they used - especially if they went to one of those people who specialize in large refunds. Seems unethical preparers willing to prepare fraudulent returns are often also willing to commit fraud themselves.

Probably work with IRS on what to do with the check and if they've got a police report going inform the police as well about the check.

http://www.irs.gov/uac/Taxpayer-Guide-to-Identity-Theft

[S T]

I just did a quick "google search" Sunrise Bank does participate in Rapid Refunds - not sure though if the Calif location versus the Minn location are one in the same. Seems also to be connected to Turbo Tax, possibly

I would just try to handle all through IRS since you have a "reject"

Sandy

[kathyc2]

Calling the IRS fraud line at 7 am and the wait was "only" 30 minutes.

I've never used bank products, so not very familiar with them. The way IRS explained to me, was the check should go back to bank, because after the IRS determines the fraud, they will reverse the 5,500 sent to bank, and then it's up to the bank to get the money back from who they distributed it to.

Just in case the info from IRS is wrong, I'm going to suggest hanging on to the check until the bank requests it's return.

[taxbooker]

same Sunrise problem

My second client this year with a rejected return, just called w/ some interesting information.

They received a check in the amount of 4440 from a Sunrise Bank in CA, but TP lives in Indiana. They got a letter, which incidentally was addressed to both of them, stating it was for their 2014 refund. Also in the letter she said that the refund was for 5,932. It is unknown what happened to the ~ 1,500 difference?

Anyone have a clue what it going on with this? And what to do with the check? I'm assuming the money should go to Treasury rather than Sunrise Bank.

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3rd Client this year with ID theft issue. One received Sunrise bank CA check as above for $4900 and apparently $1200 preparer fee taken out. Also listed on the check were Santa Barbara Tax Products Group (?), a typical refund processing service. IRS said they may need the Sunrise check made over to them and returned, so they can issue a legitimate refund to TP.

[kathyc2]

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3rd Client this year with ID theft issue. One received Sunrise bank CA check as above for $4900 and apparently $1200 preparer fee taken out. Also listed on the check were Santa Barbara Tax Products Group (?), a typical refund processing service. IRS said they may need the Sunrise check made over to them and returned, so they can issue a legitimate refund to TP.

I seriously don't think the IRS has a clue on this. When I first called IRS fraud line, the agent told me that client would need to return check to Sunrise.

Clients were here this week and we called IRS fraud line for taxpayers to report their fraud and that agent said they needed to write void on the back of the check and send it to IRS Kansas City. I told this agent what the other agent said, and she insisted that what she was telling me was correct.

Now you are saying an agent says the check should be endorsed over to Treasury? Holy crap!

[Burke]

I agree with your first idea that you hold onto the check to see WHO wants it back. In writing.