The IRS is letting the computer do the walking through its gigabytes of data on taxpayers in a new effort to find and ferret out the cheaters. The tax agency is expanding a program that searches for inconsistencies between mortgage payments and income. It hopes to scrutinize the information that banks send to the IRS about mortgage payments and match it with the income declared by taxpayers.

If the mortgage payment is too high for a low salary--bingo! Someone might be using undeclared income to pay off their bills, the tax police theorize. Howard Levy, a tax attorney with the Cincinnati firm Voorhees Levy, told the Wall Street Journal that mortgage-interest data could be the easiest way to spot someone who has paid in cash and doesn't report all income to the IRS.

Nevertheless, one congressman told the newspaper that the plan has a few big holes in it. For example, the IRS could be turning up people who lost their jobs and continue to pay their mortgages thanks to their savings.

"We shouldn't presume that these struggling families are tax cheats just because they continue to make their mortgage payments despite losing their income," said Rep. Charles Boustany (R-LA), the ranking minority member on the House Oversight Subcommittee.

For more on the IRS plan:
- check out this Wall Street Journal article