TIGTA Finds IRS Not Fully Compliant
by AccountingWEB on
From TIGA March 22, 2012, Press Release
According to the Treasury Inspector General for Tax Administration (TIGTA) report that was released March 22, the IRS is not fully compliant with a federal law that requires it to eliminate and report improper payments made to taxpayers.
The Improper Payments Elimination and Recovery Act of 2010 increased agency accountability for reducing improper payments in all federal programs. That law requires TIGTA to assess the IRS' compliance with improper payment requirements.
TIGTA found that the only program the IRS has identified for improper payment reporting is the Earned Income Tax Credit (EITC) Program. The IRS estimates that 21–26 percent of EITC payments were issued improperly in fiscal year 2011. This equates to $13.7–$16.7 billion in EITC improper payments.
"The IRS' failure to fully comply with this important federal law is troubling," said Treasury Inspector General for Tax Administration J. Russell George. "The law requires the IRS to establish annual reduction targets for improper payments; however, it has not done so."
TIGTA determined that the IRS did not comply with all of the improper payment requirements included in the Improper Payments Elimination and Recovery Act. The IRS has not established annual EITC improper payment reduction targets and has not computed a gross estimate of EITC improper payments, as the estimate does not include underpayments. The IRS has plans in place to establish EITC reduction targets and is exploring the feasibility of computing an improper payment estimate for EITC underpayments.
TIGTA made no recommendations in its report.
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