IRS erroneously paid child tax credits to millions of households.

By The Exchange Team

In 2021, the IRS ignored $3.7B in advance child tax credit payments for 4.1M qualified households but sent $1.1B to 1.5M filers who didn't qualify.

The audit concluded that the organisation accurately issued 98% of the funds between July and November 2021.

TIGTA called the monthly payments a "major undertaking." The American Rescue Plan Act established them in March.

In response to the allegations, the IRS claimed it blocked future payments to ineligible taxpayers in 2021 and paid millions of erroneously excluded taxpayers.

The IRS says taxpayers who mistakenly received payments had too-old children or claimed them on several tax forms.

The agency sent letters to help with reconciliation and explained how to handle extra payments in its FAQ.

Former IRS commissioner John Koskinen stated some eligible taxpayers haven't received the cash.