Home / Auto News / News article: Prisoners, The Deceased And Underage Applicants Defraud U.S Gov't Of $152 Million - AutoGuide.com News
 |  Jun 09 2011, 1:51 PM

The Treasury Inspector General for Tax Administration (a non-partisan watchdog group) says the Internal Revenue Service failed to stop millions of dollars of fraudulent claims from being issued to prisoners, the deceased and underage applicants.

The IRS’s system is designed to catch fraudulent claims before sending taxpayer money to criminals. However, a Reuters report explains that the qualified motor vehicle deduction (QMV) program was abused by thousand of individuals with a total cost to taxpayers of over $152 million and over $1 million of those losses were filed by prisoners, deceased and underage applicants.

The QMV program was created  by the Obama administration as part of the Stimulus Act, which was intended to offer consumers the ability to write off taxes associated with the purchase of new vehicles weighing less than 8,500 lbs and valued up to $49,500.

According to the report, 4,257 people should have automatically been flagged for being “excessive” according to IRS safeguards, but were not. Additionally, the IRS apparently did not require independent proof that applicants purchased new vehicles, or how much they paid in the taxes they wrote off within the program.

The IRS said they will review the claims found by the watchdog group and take necessary action to recover taxpayer money taken by fraudulent filers.

[Source: Left Lane News]