Improvements Are Needed to Identify Potentially Fraudulent Individual International Tax Returns During Processing

The Commissioner, Wage and Investment Division, should review the 99 questionable returns that received the Additional Child Tax Credit (ACTC) that TIGTA identified and take actions to recover any erroneous ACTC received.

The Commissioner, Wage and Investment Diviision, should ensure that Error Resolution tax examiners are aware of the proper procedures for resolving Additional Child Tax Credit claims on international tax returns in which the taxpayer’s Taxpayer Identification Numbers (TIN) or spouse’s TIN was not issued prior to the due date of the tax return and in which the taxpayer does not meet the qualifying child requirements.

The Commissioner, Wage and Investment Division, should review the 36,373 returns TIGTA identified that potentially received erroneous American Opportunity Tax Credit (AOTC) and take actions to recover any erroneous AOTC received.

The Commissoner, Wage and Investment Division, should review the 13,924 returns TIGTA identified that potentially received erroneous refundable credits and take actions to recover any erroneous refundable credits received.

The Commissioner, Wage and Investment Dividsion, should develop processes to systemically identify and address potentially erroneous tax returns filed by international taxpayers filing the incorrect tax forms to receive refundable credits, including returns filed by nonresidents claiming the American Opportunity Tax Credit, for which they are not eligible to receive.