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Surface acoustic wave (SAW) devices are well suited for the application as wireless and completely passive identification (ID)-tag. They operate even under harsh environmental conditions, especially under high temperatures. Interrogation units operate similar to conventional radar systems and therefore, have the same resolution restrictions when an inverse fast Fourier transformation (IFFT) is applied. The application of model-based algorithms to the evaluation of identification tags is presented and enhancements in either improved resolution or reduced system bandwidth are shown. Furthermore, optimizations in the coding scheme for reduced tag sizes are discussed, and measured results obtained by a built interrogation unit and fabricated ID-tags for an identification system are shown.