That’s what the Treasury Inspector General for Tax Administration (TIGTA) says, anyway.
In a report issued in September, TIGTA estimates that IRS could issue almost $2.3 billion in potentially fraudulent tax refunds based on these EINs yearly (about $11.4 billion over the next five years).
TIGTA identified 767,071 tax year 2011 electronically filed individual income tax returns with refunds based on falsely reported income and withholding. Of the some 285,000 EINs used on these tax returns, 277,624 were stolen EINs used to report false income and withholding with potentially fraudulent refunds issued totaling more than $2.2 billion.
TIGTA recommended that IRS update fraud filters to identify potentially fraudulent tax returns.