State Rep. Bronna Kahle today announced legislation to fight tax-related fraud and identity theft by requiring employers to file their employees’ W2 forms with the state one month earlier than under current Michigan law.
Moving up the date will get vital information to the state more quickly, helping investigators crack down on fraudulent returns filed by imposters seeking refunds under a real taxpayer’s name.
“Tax-related identity theft is a significant and growing problem,” Kahle, of Adrian, said. “The more tools we have to fight fraud, the better. This legislation protects Michigan taxpayers by providing fraud investigators with important information more quickly.”
Michigan Treasury prevented more than $15 million in tax-related identify theft refunds from more than 22,000 fraudulent returns in a recent 20-month period. The changes outlined in Kahle’s legislation could help detect and prevent even more cases.
Michigan law requires employers to send W2s to employees by Jan. 31. But employers aren’t required to send copies of those W2s to the state until Feb. 28. The delay gives criminals a head start in trying to file fraudulent returns seeking refunds.
Kahle’s bill would require employers to send W2s to the state by Jan. 31 – the same deadline they have to send the forms to their workers. Some employers could be required to file information electronically.
The state would be able to verify tax withholding amounts and other information more quickly, helping investigators better identify fraudulent refund requests.
“Other states are moving quickly to adopt the Jan. 31 filing deadline because they know it’s the right thing to do,” Kahle said. “We must make this switch to protect Michigan taxpayers.”
Kahle’s legislation: House Bill 5091.