WASHINGTON — A government investigator says the Internal Revenue Service has paid out more than a half-billion dollars in homeowner tax credits to people who probably didn't qualify.
An inspector general said in a report released today that most of the money — about $326 million — went to more than 47,000 taxpayers who didn't qualify as first-time homebuyers. Other credits went to prison inmates, taxpayers younger than 18 and people who did not actually buy homes.
The popular credit provided up to $8,000 to first-time homebuyers and up to $6,500 to qualified current owners who bought another home during parts of 2009 and 2010.
The IRS said it worked hard to enforce a complicated tax credit that provided more than $27 billion to almost 3.9 million taxpayers.
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