The IRS Integrity and Verification Operations

Integrity & Verification Operation (IVO) department provides leadership and direction to employees responsible for fraud detection and prevention, revenue protection, and account correction.

Integrity and Verification Operation (IVO) is the department designated to screen individual master file returns in the Electronic Fraud Detection System (EFDS) for possible identity theft and false income and withholding. Individual master file returns are scored through the Dependent Database (DDb) or through the Return Review Program (RRP) system. These scoring processes identify suspicious returns meeting the scoring tolerances for screening by IVO employees.

Return Integrity Operation(RIO) strengthens the integrity of the tax system by:

• Protecting the public interest by improving the IRS’s ability to detect and prevent improper refunds
• Serving the public interest by taking actions fairly and appropriately to identify, evaluate and prevent the issuance of improper refunds
• Helping taxpayers understand the refundable tax credits for which they are eligible.
• Recover Improper Payments

The IRS Integrity and Verification Operations (IVO) could be delaying a number of taxpayer refunds to screen them for identity theft and refund fraud.

Taxpayers identified by the program may receive a “4464C” letter from IVO stating that their tax return is being thoroughly reviewed so that the IRS can “ensure the accuracy of return information.” The letter states that the IRS may contact the taxpayer or third parties for further information and that if the taxpayer does not hear from the IRS or receive his or her refund within 60 days from the date of the letter, the taxpayer may contact the IRS directly. Once the IRS has completed its review, it may send a full or partial refund or no refund. Whatever the decision, the taxpayer can appeal it.

The IRS has indicated that the letters are part of the Return Review Program (RRP) to combat stolen identity refund fraud and do not mean the taxpayer has been selected for audit. The IRS uses algorithms similar to a discriminate function system score to detect potential refund fraud. Certain characteristics — like whether the taxpayer is a first-time filer, is receiving a refund unusually larger than the one from a prior year or is receiving W-2 income unexpectedly — can trigger an alert to IVO to further investigate the taxpayer’s return.