Tags: irs | tax | credit | home

Watchdog Faults IRS over Home Tax Credits

Wednesday, 29 Feb 2012 04:32 PM

The U.S. Internal Revenue Service could have done more to catch phony claims for first-time homebuyer tax credits, an IRS watchdog unit said on Wednesday.

The U.S. tax collecting agency denied $1.6 billion in erroneous claims for the credit through July 30, 2011, but many questionable claims were never examined, said the Treasury Inspector General for Tax Administration in a report.

Taxpayers received potentially erroneous refunds worth $513 million from the credit, TIGTA said in a report last April.

Introduced in 2008 partly to boost the economy, the credit allowed qualified home buyers to claim up to $8,000 on the purchase of a first home. The credit expired in mid-2010.

Taxpayers received more than $30.4 billion from the credit, TIGTA said.

But some claims for the credit were never run through IRS anti-fraud computer filters, the watchdog said.

IRS initially did not require taxpayers to justify their claims, but Congress later tightened standards on it.

The IRS said it faced challenges in setting up the credit program but that it mostly agrees with the TIGTA report.

"With limited resources, we did not necessarily look at more returns for examination, but different returns. This report does not measure the amount of money that would have been recaptured had we examined the original pool of returns," an IRS spokesperson said in a statement.

© 2017 Thomson/Reuters. All rights reserved.

 
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2012-32-29
Wednesday, 29 Feb 2012 04:32 PM
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