WASHINGTON (AP) — The Internal Revenue Service paid more than $13 billion in tax credits last year to people who may not have qualified, a government investigator said Tuesday.
The Earned Income Tax Credits were supposed to go to low-income working families.
The agency's inspector general issued a report Tuesday saying the improper payments were between $13.3 billion and $15.6 billion. That's about a quarter of all EITC payments.
"The IRS can and must do more to protect taxpayer dollars from waste, fraud and abuse," said J. Russell George, the Treasury inspector general for tax administration.
The IRS said it is aggressively fighting tax fraud, and is improving its efforts to police EITC payments. The agency said it has stopped nearly 15 million suspicious returns since 2011, blocking more than $50 billion in fraudulent refunds.
"The IRS remains deeply concerned about the level of improper payments, and a major review currently underway is exploring a wide range of options to distinguish valid claims from excessive ones," the IRS statement said.
The Earned Income Tax Credit is one of the nation's largest anti-poverty programs. In 2011, more than 27 million families received nearly $62 billion in credits.