IRS Refunds $4 Billion Child Tax Credits Per Year to Illegal Immigrants Whose Kids Do Not Live in US (and May Not Exist at All); Earned Income Fraud Another $13 Billion
Courtesy of Mish
Here's an interesting video that came my way yesterday from a close friend. The video highlights a news investigation by Channel 13, WTHR in Indianapolis, regarding fraudulent refunds of taxpayer money to illegal immigrants living in the US. The refunds are based on child tax credits, when the kids live in Mexico or elsewhere.
Link if video does not play: Another Massive Tax Loophole!
Typically videos like this are not remotely true, but this one is according to FactCheck.
Q: Does the IRS pay billions in tax refunds to workers who are in the U.S. illegally?
A: Yes. The Treasury Department’s Inspector General determined that $4.2 billion was paid in 2010, up from less than $1 billion in 2005. Leading Democrats are resisting a bill that would stop future payments.
FULL ANSWER
This is a rare case of an Internet rumor with some substance to it. In fact, it’s shaping up as a major dogfight in Congress. At issue here are the federal child tax credits that can be claimed by persons with dependent children under age 17. Some Democrats are already defending these child tax credit payments that have gone to those without a valid Social Security number, accusing Republicans who want to end them of a heartless attack on children.
Several different versions of this viral email all cite a recent investigative story by an Indianapolis television station, but WTHR-TV is far from the first to notice. The Washington Post and others reported on this last year when the Treasury Department’s inspector general for tax administration issued a report on July 7, 2011.
The title of the report summed up the IG’s [Treasury Inspector General] finding: “Individuals Who Are Not Authorized to Work in the United States Were Paid $4.2 Billion in Refundable Credits.”
Problem Still Not Addressed
The WTHR video appears to be from 2012. The treasury inspector general report came out in 2011.
So Congress, the treasury, the IRS, and presumably president Obama have known about this for at least two years.
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