Please ensure Javascript is enabled for purposes of website accessibility

IRS Stopping $1.6 Billion in Mistaken Homebuyer Tax Credits Doesn’t Impress Everyone

The Service gets an 'A' for effort but also 'D' for "do more with less."

The U.S. Internal Revenue Service rejected $1.6 billion in erroneous claims for the first-time homebuyer tax credit, according to a report by the Treasury Inspector General for Tax Administration. The refundable tax credit, worth as much as $8,000, was available to first-time homebuyers who made purchases in 2008, 2009 and 2010. As of July 30, 2011, the IRS processed 4.3 million claims for the credit totaling almost $30.4 billion, according to the inspector general’s report. The report was issued today as a follow-up to a 2009 audit by the inspector general that said the IRS didn’t do enough to prevent fraudulent claims for the credit. More than two years later, the IRS is still falling short, the report said. “Examination resources could have been used more effectively,” according to the report. The inspector general said the IRS didn’t implement filters to detect potential fraud related to the credit until after the agency had processed more than 1.1 million claims. Of those claims, the IRS went back and found that 250,159 were “questionable.” The watchdog said the IRS audited 69,953 of the claims — fewer than a third — because it decided it didn’t have the resources to review all of the questionable claims.

Latest Accounting Jobs--Apply Now:

Have something to add to this story? Give us a shout by email, Twitter, or text/call the tipline at 202-505-8885. As always, all tips are anonymous.

Comments are closed.

Related articles

illustration of an empty desk

House Speaker Kevin McCarthy Celebrates Defunding the Agents the IRS Wasn’t Gonna Be Able to Hire Anyway

Last year’s Inflation Reduction Act allotted a whole bucket of cash to the IRS ($80 billion) to modernize its ancient systems and bring on new employees, a lot of employees. At the time, we wondered where the IRS was going to find tens of thousands of people with a bachelor’s degree and 30 units of accounting […]

screenshot of a ChatGPT response that looks like a scam email

AI Poised to Put Fake IRS Agents Out of a Job

Of all the occupations most at risk of being replaced by synths AI in the near future — bookkeepers, programmers, and washed-up accounting blog writers, to name a few — no one really talks about how ChatGPT, Bard, and Microsoft’s Bing AI (if you’re counting that one) will impact scammers. You know, those people who […]