Free Republic

One-fourth of IRS payments for several major refundable tax credits are being improperly made, costing the government billions of dollars, the Treasury's inspector general for tax said. In a report released Tuesday, the inspector general found that the rate of improper payments remains high, at nearly 25 percent, for the earned income tax credit, the refundable portion of the child tax credit, and the American Opportunity tax credit, a benefit for college students. While the IRS has acknowledged that the earned income tax credit is a high risk, it "still does not provide a valid assessment" of the rate of...

IRS contractors without background checks had access to sensitive information, potentially putting confidential taxpayer data at risk, according to a federal audit. The Treasury inspector general for tax administration found more than a dozen cases in which the IRS awarded contracts that required access to taxpayer information without background investigations or before those checks were completed. Under IRS policy, background checks are mandatory for contractors who work with that kind of data. "Allowing contractor employees access to taxpayer data without appropriate background investigations exposes taxpayers to increased risk of fraud and identity theft,” said J. Russell George, the inspector general....

Much to my surprise, the previous round of witness testimony ended up being more significant and interesting than the late afternoon session. IRS Inspector General Russell George defused many of the Democrats' lines of attack during his opening statement, effectively "pre-butting" gotcha -style questions. A few observations: (1) George reminded the committee that the IRS acknowledged and apologized for its improper targeting of conservative groups prior to the release of his audit in May. Don't forget that the agency's own internal review -- which predated the IG's audit -- came to similar conclusions about the malfeasance, including who was victimized....

Among all the unanswered questions about the IRS’s illegal targeting of conservative organizations, one is most crucial: Who ordered this extreme scrutiny? Amazingly, IRS inspector general J. Russell George, responsible for the investigation asking those questions about the IRS, has testified that he did not obtain that information. Details of that testimony are interesting. Representative Tom Graves (R., Ga.) asked, “Have you asked the individuals who ordered them to use this extra scrutiny to punish, or penalize, or postpone, or deny?” George turns around to confer with his assistant. Just the fact that the inspector general had to confer to...