WASHINGTON — The Internal Revenue Service paid more than $13 billion in tax credits last year to people who may not have qualified, a government investigator said Tuesday.
The improper payments in Earned Income Tax Credits were between $13.3 billion and $15.6 billion, about a quarter of all payments for the low-income subsidy.
“The IRS can and must do more to protect taxpayer dollars from waste, fraud and abuse,” said J. Russell George, the Treasury inspector general for tax administration.
The IRS said it has stopped nearly 15 million suspicious returns since 2011, blocking more than $50 billion of fraudulent refunds.
If the credit is larger than your total income tax bill, the IRS will pay you the difference. It goes to low-income families that pay little or no federal income tax. But it also makes the credit more susceptible to fraud. Using IRS statistics, the inspector general’s report says the IRS paid out at least $124.1 billion in improper payments from 2003-13, and perhaps as much as $148.2 billion. The Associated Press
