Ernest Istook: “The error rate we are discussing regarding the EITC is not an old number. This was something that a special task force…”

“The error rate we are discussing regarding the EITC is not an old number. This was something that a special task force was formed within the IRS and the Treasury Department, and their most recent comprehensive survey was January of last year, January of 2002, where they established the EITC error rate is between 27 and 32 percent. If we compare that with other major social benefit programs, such as temporary assistance to needy families, food stamps, Social Security, disability, and Medicaid, they have the error rates below 10 percent, whereas the EITC error rate is 27 to 32 percent. Three times as many mistakes. Why? Because we do not have any checking up on people. And we are not just checking up on this program. We have, in the IRS budget, an increase of $160 million going after upper-income taxpayers, people that may be scofflaws and trying to bend or twist or distort our tax laws. We are trying to go after this across the board, but we need to have verification and documentation for people that expect the taxpayers to be doing this for them. Under the EITC, a person can receive a check from the Federal Treasury for as much as $4,204. That is above and beyond whatever they might or might not have paid in income taxes. On average, for these 19 million people, on average they receive $1,705 above and beyond what they paid in income taxes.”