IRS erred on child tax credit payments for millions of eligible families – but aid was 98% accurate overall, report finds

Personal finance

JGI/Tom Grill

The IRS skipped about $3.7 billion in advance child tax credit payments for 4.1 million eligible households, but sent more than $1.1 billion to 1.5 million filers who didn’t qualify in 2021, according to an audit released Tuesday by the Treasury Inspector General for Tax Administration.

However, the agency accurately issued 98% of the aid, the report found, based on a review of 178.9 million total payments made between July and November 2021. 

More from Personal Finance:
Why some have yet to access funds from expanded child tax credit
Medicare standard Part B premiums will drop to $164.90 next year
8 million student loan borrowers will get automatic forgiveness

Described as a “significant undertaking” by TIGTA, the monthly payments began in July 2021, four months after being enacted through the American Rescue Plan Act in March.

In an official response to the report, the IRS said it took corrective action in 2021 to block future payments to ineligible taxpayers and issued funds to millions of taxpayers who were erroneously excluded.

Taxpayers who wrongly received payments had children who were too old to qualify, or in some cases, were claimed on multiple tax returns, according to the IRS. The agency sent letters to assist with reconciliation and covered how to handle excess payments when filing 2021 tax returns on its FAQ page

However, some eligible filers still haven’t received the funds, former IRS commissioner John Koskinen said during a Bipartisan Policy Center panel on Monday.

Products You May Like

Articles You May Like

Billionaire Kwek Leng Beng’s CDL Halts Plan To List U.K. Properties In Singapore Amid Challenging Market
‘This is a crisis.’ Why more workers need access to retirement savings
35% of millionaires say it’s ‘going to take a miracle’ to be ready for retirement, report finds
Hong Kong’s Hang Seng had its best month since 1998, but remains in bear market territory
Astra chief engineer resigns, CEO shakes up management ‘to execute faster’