Audit reveals the IRS sent over $1 billion in child tax credit payments to ineligible households

The Internal Revenue Service (IRS) incorrectly sent over $1 billion in child tax credit payments last year to millions of Americans who were not eligible for the funds, an audit on Tuesday revealed.

The audit found that, along with the 3.3 million payments that were sent in error between July and November of last year, the IRS also failed to send payments worth $3.7 billion to the over 4 million tax payers who were eligible for the free cash.

The wrongly delivered payments which were sent to 1.5 million taxpayers who did not meet eligibility requirements such as “a dependent did not meet age requirements, was deceased, or was claimed on another tax return,” the Treasury Inspector General for Tax Administration report stated.

The audit said that the taxpayers who received the payments that they were not entitled to were likely forced to fork over the money on their 2021 tax returns filed this year while the people who should’ve gotten the money and were unable to claim the full amount on their tax returns.

The audit did say in defense of the IRS that despite the high volume of incorrect payments made along with failed disbursements, 98% of the child tax credit payments made by the IRS between July and November 2021 were correctly processed.

Wage and investment division commissioner Kenneth C. Corbin made comments following the release of the audit, “Achieving this level of accuracy within the limited timeframe provided required a significant amount of collaboration among several agencies within the Department of Treasury.”

The IRS also responded to the audit and said that most taxpayers received the payments they were owed while explaining that their staff had been charged with a large undertaking.