The IRS mistakenly issued $11.6 billion in 2012 tax refunds: the error rate was as high as 20%

The IRS mistakenly issued $11.6 billion in 2012 tax refunds: the error rate was as high as 20%. The Washington Post reported that the Treasury Department issued a report this week, saying that the Internal Revenue Service (IRS) in 2…

The IRS mistakenly issued $11.6 billion in 2012 tax refunds: the error rate was as high as 20%. The Washington Post reported that the Treasury Department issued a report this week saying that the Internal Revenue Service (IRS) improperly issued $11.6 billion in refunds for the 2012 Earned Income Tax Credit. According to reports, Treasury Deputy Inspector General Michael McKenney found that the IRS failed to meet the requirement that the error payment rate should be reduced to less than 10% for two consecutive years. The IRS estimates that at least 21 percent of EITC refunds issued in 2012 were incorrect, which is lower than the previous nine years. However, the amount of improper refunds increased by approximately 22 percent to more than $11.6 billion. Overall, the IRS has improved in reducing improper payments, but the IRS's unreliable risk assessment process has increased the potential for taxpayers' money to be wasted, defrauded and misused, the report said. Especially during economic downturns, the IRS should go all out to avoid erroneous refunds. The Earned Income Tax Credit program rebates taxes to low-income earners and low-income families, especially families with children. The IRS said errors with the EITC were caused by a variety of reasons, including the complexity of the law, the changing population eligible for the refund, and loopholes in the program itself.