Thousands wrongly claimed electric car tax credit
Taxpayers got $33 million in credits for vehicles that didn't qualify, including a Hummer.
This article is by Ken Thomas of The Associated Press.
Car companies are slowly rolling out rechargeable electric cars. But that didn't stop thousands of U.S. taxpayers, including prisoners and some IRS employees, from incorrectly claiming lucrative tax credits for the electric vehicles last year.
A Treasury Department inspector general report says nearly 13,000 taxpayers erroneously claimed about $33 million in credits for plug-in electric and alternative vehicles during the first six months of 2010. The inspector general says about 20% of the $163.9 million in credits provided to taxpayers were claimed in error.
President Barack Obama has pushed for 1 million electric cars on the road by 2015 and the tax breaks are part of that strategy. The government has offered numerous incentives to drum up interest in the vehicles, including a $7,500 tax credit for a plug-in electric drive motor vehicle and incentives for converting a car into a plug-in.
Auto companies are just beginning to mass market the vehicles. Since December, GM has sold 647 Chevrolet Volts, an electric car with a backup gasoline-powered engine.
During the same period, Nissan sold 106 versions of the Leaf, which is powered by a rechargeable battery.
But Treasury Department review found problems with thousands of taxpayers claiming the credits for cars that failed to qualify. For example, some car owners tried to claim the $7,500 credit for their Hummer H3, Dodge Durango or Cadillac Escalade. Someone claimed it for a golf cart.
The report said some IRS employees erroneously claimed the credits. They were referred to the department's Office of Investigations for further review.
Even prisoners tried to take advantage. The inspector general found that 29 prisoners received $49,926 in vehicle credits even though they were incarcerated throughout 2009.
The IRS agreed with a series of recommendations made by the inspector general to recover erroneous credits and to make changes to manuals and software systems to ensure that taxpayers don't claim vehicles that fail to qualify. The report said efforts by IRS management to reduce the incorrect claims helped the department protect $3.1 million in revenue.
Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
More from MSN Money:
VIDEO ON MSN MONEY
"Someone claimed it for a golf cart."
Someone? That was the best part of the scam! Everyone was buying golf carts. The government bought the carts , you'd sell them at half price and pocket the money.
Golf cart companies were running ads all over Florida.
It's similar to the food card (stamp) program here in Washington. You give the store owner $100 credit from your card, you get $50 cash (but no groceries). (You get your groceries free at the food bank) and of course your marijuana is now paid for with tax payer dollars. Everybody wins. The store owner, the druggie and of course the dealer. (I think they call that a triple double in basketball).
Lets grow government even bigger! Yay!
There should not be tax credit for these "electric" vehicles anyway, as most are purchased by well-to-do buyers....
......and they will only place more stress on our outdated and deteriorating power grids, and worst yet, move towards building more Nuclear Plants.
Unless we're wrong, no one has still figured out what to do with the spent Nuclear Rods, which are increasing every year.
This is the environmental problem that has not been solved since the matter came to the public's attention back in the 70's.
Copyright © 2014 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.