Good News: Computer Glitch Caused The IRS To Issue $46 Million Worth Of Questionable Refunds

Matt Vespa
Posted: Dec 22, 2015 7:20 PM
Good News: Computer Glitch Caused The IRS To Issue $46 Million Worth Of Questionable Refunds

It seems as if it’s nothing but a parade of horribles coming out of the IRS. Then again, we shouldn’t be shocked since this is a government agency; one that’s been at the center of a still unresolved controversy relating to political targeting of conservative groups from its Exempt Organizations unit. Yet, the issue here is millions in erroneous tax refunds that were caused by a computer glitch. Liz Harrington at the Washington Free Beacon has more:

The Internal Revenue Service issued more than $46 million in erroneous tax refunds due to a computer glitch and ineffective monitoring, issues that left uncorrected could cost taxpayers up to $230 million over the next five years.

The Treasury Inspector General for Tax Administration (TIGTA) released an audit Monday faulting the IRS for approving thousands of potentially fraudulent tax refunds in 2013.

“TIGTA identified that because of a programming error, over $27 million of refunds were erroneously issued for 13,043 Tax Year 2013 tax returns,” the audit said. “The programming error is overriding the IRS’s two-week processing delay on some refund tax returns that are identified by the IRS as potentially fraudulent.”

The audit said the returns were flagged for claiming a “questionable tax credit” but were then automatically issued before the IRS could complete its verification process.

In addition, the audit identified 3,910 “potentially fraudulent” tax returns that were issued due to ineffective monitoring, totaling $19 million.

The IRS recently got a three percent increase in funding from last year when Congress passed a $1.1 trillion spending bill before heading home for the holidays. That increase is specifically for “taxpayer services to ensure that the agency responds to taxpayer questions in a timely manner, and to improve fraud detection and prevention and cyber security.”