That person you friended just might be your friendly taxman

Don’t recognize the name of that person who just friended, or followed, you on Facebook, Twitter or MySpace? Well rather than just blindly accepting and returning the favor you may want to do some serious checking because that could be your local taxman knocking on your cyber front door.

Increasingly IRS agents are turning to social media networks in order to find those people they believe owe the government some money. In a post at the Wall Street Journal, Laura Saunders tells about how state revenue agents as well as IRS agents are beginning to mine the social media world for those people who think they can hide and not pay their taxes.

While their typical online searches might include bank, tax, motor vehicle, and employment records they are starting to include Google, Facebook and MySpace as part of their investigations. There are limits though as revenue agents, state and federal, are only allowed to use information that is publically available online. this means that more ‘public’ oriented sites like MySpace are searched than say Facebook where the default setting is private.

As much as the title of this post might be humorous the fact is that revenue agents are not allowed to ‘friend’ someone using false information. That hasn’t stopped the agents from chalking up more than a few profitable successes when it comes to collecting on delinquent taxes.

In Minnesota, authorities were able to levy back taxes on the wages of a long-sought tax evader after he announced on MySpace that he would be returning to his home town to work as a real-estate broker and gave his employer’s name. The state collected several thousand dollars, the full amount due.

[….]

One [Nebraska] agent collected $30,000 of unpaid tax from a resident after a Google search found him listed as a high-ranking local marketing rep for a national firm. If a Google online search isn’t productive, agents use the social sites or chat rooms in a last-chance hunt for their quarries.

As popular as this method of finding tax evaders might be with some states not all of them are jumping on the bandwagon yet. Some like Massachusetts and Oregon are still in the exploratory stage of see how using the Web can help them.