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Bogus Obama Stimulus Tax Credits Found in IRS Audit


The “Stimulus” is back!  You remember Barack Obama’s 2009 “stimulus,” right?  That was the trillion dollar government spending program for “shovel ready jobs” that was going to revive the economy.  It turned out, as Obama was forced to admit, there were no shovel ready jobs.  And no economic stimulus either.

What was ready though, was every state and federal government agency and the “education community.”  It seems the only thing that students are learning in the hallowed halls of higher education is how to bilk the half of the nation who actually pay taxes.  And, they seem to be pretty good at that.

The IRS doled out more than $5 billion in potentially bogus college aid payments in 2012 under an Obama stimulus tax credit, according to a report Tuesday from the agency’s inspector general that said the administration still doesn’t have a good handle on how to root out erroneous claims.

That $5.6 billion was spread out among four union college students who had questionable IRS claims. And that was for just 2012. About half the students never provided a tuition statement and many others attended schools that didn’t qualify for the tax credit or claim the credit for more than four years.

There are a number of things going on here with this. First of all, the tax code is too complicated. We can understand how a filer could mis-file their 1040.

Second, since we personally deal with recent college graduates every day, it’s very easy for us to believe that the colleges and universities haven’t taught them anything. Well, except for a sense of entitlement from “the government.”

Third thing we can take away from this is that the IRS is a perfect snapshot of the federal government as a whole. It’s too big, they are not accountable to anyone, and they just don’t care about effectively doing their jobs.

To illustrate the last point the Treasury Inspector General noted in his report “the IRS still does not have effective processes to identify erroneous claims for education credits… Many of the deficiencies TIGTA previously identified still exist.”

Inspector General’s report refers only to 2012, but this program has been on the books since 2007 but the Obama stimulus in 2009 put it on steroids.

With respect to the IRS’ complete lack of accountability, we would site and IRS statement from last week where the agency blamed Congress for not giving it the power to automatically reject tax returns and “correct” them. In addition, they pointed a finger at Congress for underfunding them. “Funding limitations have severely hampered our efforts in this and other compliance areas.”

We don’t recall that problems with funding limited their ability to block Tea Party groups from getting tax exemption, or auditing conservatives. We guess that the IRS’ priorities are just different than ours.

This is your government work. Remember this, and the fact that the IRS call centers simply stopped taking calls from taxpayers seeking help, the next time you hear calls to federalize policing.


About Author

Michael Becker is a long time activist and a businessman. He's been involved in the pro-life movement since 1976 and has been counseling addicts and ministering to prison inmates since 1980. Becker is a Curmudgeon. He has decades of experience as an operations executive in turnaround situations and in mortgage banking. He blogs regularly at The Right Curmudgeon, The Minority Report, Wizbang, Unified Patriots and Joe for America. He lives in Phoenix and is almost always armed.


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