IRS paid $415M in refunds to dead people last year.

Wonder how much of it was fraud.

IRS paid $415M in refunds to dead people last year.

 

 

** cough cough **

IRS paid $415M in refunds to dead people last year.

 

How much of that was to someone who died during the tax year (this year someone who died in 2014) and legitimately is due a tax refund. Statistically speaking, with a population of 300 million, that is a lot of people dying each year who are owed a refund, well technically it would be their estate owed the refund. The 415M may consist of quite a bit of legit refund due.

They will, but the employers of these guys will now be paying taxes on them and from here on out. Additionally, taxes will come out of the illegals' paychecks....finally.

 

I would have to guess this is not accurate. I used to prepare taxes for poor people under the Vita program (Volunteer Income Tax Assistance) and 95% of the returns I did were of income levels which met the earned income credit (EIC).

 

The earned income credit was originally a way to get low income earners ALL of their taxes back. Not just income taxes but the payroll taxes related to it. This was a credit that was designed to encourage the low income to continue working and not get on welfare. The program has become much, much more than that. Many of the people I did returns for were receiving refunds for several thousand dollars where the total amount of income and payroll taxes taken out of their paychecks were less than $500. There is no way the amount of payroll taxes their employers pay in exceed that. This is a NEGATIVE revenue source for the government. For a purely financial reasons, the federal budget would be better off if these people paid no taxes at all and were not eligible to file taxes until they are citizens.

 

The earned income credit is in all reality another form of welfare hidden within the tax system so that amounts given as credits do now show up in total welfare spending. This was a pretty slick move by Clinton but he didn't earn the name Slick Willy for nothing.

 

The biggest problem with the EIC, is that it is very easily manipulated. If you look at the formula which drives the EIC, the credit grows up to a certain earned income amount and then starts to shrink. In my experience of preparing low income taxes, many people's W-2's would always come close to that amount which generates the highest EIC. That was because when they realized by continuing to work, they would lose EIC, they would quit. Or, if they only worked part time or part of the year and their W-2's didn't total high enough to reach the highest credit, they would report undocumented income (baby sitting, lawn mowing, car washing, etc.) that they were paid cash for and therefore did not have a W-2 or a 1099. When preparing those taxes, that undocumented income would always make they reach the earned income level to max out the credit.

 

While I favor programs to encourage the poor to continue working, the EIC has turned into a terrible program that needs to be reformed/pared down/scrapped/whatever. Democrats will fight tooth and nail to stop that.

IRS paid $415M in refunds to dead people last year.

 

Saw where total federal improper payments last year were 125B! Wonder what the total is when all the states are added.

How much of that was to someone who died during the tax year (this year someone who died in 2014) and legitimately is due a tax refund. Statistically speaking, with a population of 300 million, that is a lot of people dying each year who are owed a refund, well technically it would be their estate owed the refund. The 415M may consist of quite a bit of legit refund due.

 

I did two last year where the person had passed away during the year but their estate received a refund. So take about $6300 off the total.

IRS paid $415M in refunds to dead people last year.

 

Depends of the definition of " dead" ??