Scarinci Hollenbeck, LLC
The Firm
201-896-4100 info@sh-law.comFirm Insights
U.S., State Governments Rely on New Software to Combat Tax Fraud
Author: Scarinci Hollenbeck, LLC
Date: August 7, 2013
Key Contacts
Back
As the Internal Revenue Service attempts to close the multibillion-dollar tax gap, a large portion of its resources are being geared to combat tax fraud involving sizable assets. This includes offshore tax havens, tax evasion, and, as of late, unpaid or incorrectly calculated estate taxes. However, recent crimes relating to sophisticated identity theft rings have also bilked the government out of millions of dollars, and federal and state agencies are now implementing several new types of web software to combat these tax law violations.
The IRS will rely upon a combination of complex software from several different providers to ensure that tax returns are legitimate, the Wall Street Journal reports. The business software providers that will assist the IRS in accomplishing these goals include SAS Institute, LexisNexis Group, and International Business Machines (IBM). The various software types work in different ways that complement each other and provide a more accurate and comprehensive tax infrastructure than any stand-alone methods. For example, the SAS software uses publicly available data to verify a person’s identity instantly, the Journal explains.
LexisNexis compares all tax-filing information against a database of personal information that the company has been collecting since the 1990s. As an example, the Journal explained that if a state receives a tax return from a person who claims to be employed in one state or have a certain number of children, but the LexisNexis database shows different information, the return will be flagged and individuals may be required to provide proof of their identity.
The IBM software works by “predicting” criminal activity based on individuals’ relationships and actions, but the firm failed to elaborate on how the system specifically works.
Like many other government agencies, the IRS has been burdened by budget cuts. However, the agency is attempting to find more creative ways to combat tax crimes through technology and international agreements.
- Assets
- Estate & Trust Litigation
- Fraud
- Internal Revenue Service
- IRS
- Tax Evasion
- Tax Fraud
- Wealth Preservation
- Practices: Tax and Trusts & Estates, Sophisticated Estate Planning & Wealth Preservation
- Locations: Red Bank, NJ, New York City, Little Falls, NJ
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
Buying Commercial Property in New Jersey: Legal Guide for Small Businesses
Small businesses considering buying commercial property in New Jersey must evaluate a range of legal, financial, and operational factors. While ownership can offer long-term value and control, it also introduces significant risks if not properly structured. This guide outlines key considerations to help New Jersey business owners make informed decisions, minimize legal exposure, and successfully […]
Author: Robert L. Baker, Jr.
The SEC’s Latest Guidance on Applying Federal Securities Laws to Tokenized Securities
On January 28, 2026, staff of the U.S. Securities and Exchange Commission’s Divisions of Corporation Finance, Investment Management, and Trading and Markets issued a joint statement clarifying how existing federal securities laws apply to tokenized securities. The SEC’s “Statement on Tokenized Securities” does not establish new law, but it does provide greater clarity on the […]
Author: Dan Brecher
Common Legal Mistakes NYC and New Jersey Business Owners Make
Operating a business in the New Jersey and New York City metropolitan region offers incredible opportunities, but it also requires navigating a dense and highly regulated legal environment. From entity formation to regulatory compliance, seemingly minor legal oversights can expose business owners to significant risk. In our work with businesses throughout the region, our attorneys […]
Author: Dan Brecher
What Founders Can Learn From Start-up Suits
High-profile founder litigation is more than just a media spectacle. For startup founders, these cases underscore the legal and structural risks that can arise when rapid growth outpaces formal oversight. While launching a new company can be both an exciting and deeply rewarding endeavor, founders must be mindful that it also comes with significant risks. […]
Author: Dan Brecher
Corporate Governance Reviews: A Practical Guide for New Jersey Companies
Every New Jersey company should periodically evaluate its governance framework. Strong corporate governance protects directors and officers, builds investor confidence, reduces litigation exposure, and positions a company for sustainable growth. The first quarter of the year is a great time to evaluate your corporate governance practices and perform any routine maintenance needed to keep that […]
Author: Ken Hollenbeck
What to Do After Being Served with a Lawsuit: Steps to Protect Your Legal Rights
Being served with a lawsuit is one of the most stressful legal events a business or individual can face. Whether the claim involves a contract dispute, an employment matter, an intellectual property issue, or another legal challenge, the actions you take in the first few days can significantly shape the outcome of your case. Acting […]
Author: Robert E. Levy
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.