In its May 2016 report on the Low-Income Housing Tax Credit (LIHTC) program of the Internal Revenue Service (IRS), GAO found that state and local housing finance agencies (allocating agencies) implemented requirements for allocating credits, reviewing costs, and monitoring projects in varying ways. Moreover, some allocating agencies' day-to-day practices to administer LIHTCs also raised concerns....

Federal budget formulation processes include fewer controls and reviews, and provide less information on tax expenditures—which represented an estimated $1.23 trillion in forgone revenues in fiscal year 2015—than for discretionary or mandatory spending. For example, in the President’s budget, tax expenditure revenue loss estimates are presented separately from related spending, making their...

The Earned Income Tax Credit (EITC), the Additional Child Tax Credit (ACTC), and the American Opportunity Tax Credit (AOTC) provide tax benefits to millions of taxpayers—many of whom are low-income—who are working, raising children, or pursuing higher education. These credits are refundable in that, in addition to offsetting tax liability, any excess credit over the tax liability is refunded t...

Key state supports, in the form of state policies, aided the development of utility-scale electricity generation projects—particularly renewable ones—in most states, for fiscal years 2004 through 2013. For example, most states have a renewable portfolio standard (RPS) mandating that retail service providers obtain a specific amount of the electricity they sell from renewable energy sources, wh...

Internal Revenue Service (IRS) data are not sufficient for identifying who claims a tax expenditure and how much they claim for $492 billion or almost half the dollar value of all tax expenditures that GAO examined. Such basic data are not available at IRS for tax expenditures because they do not have their own line item on a tax form. This included $102 billion of tax expenditures that were not o...

A small percentage of U.S. families saved in 529 plans in 2010, and those who did tended to be wealthier than others. According to the Survey of Consumer Finances (SCF), less than 3 percent of families saved in a 529 plan or Coverdell Education Savings Account (Coverdell)--a similar but less often used college savings vehicle also included in the SCF. While the economic downturn may have reduced i...

GAO's previous work has shown that, once enacted, tax expenditures and their relative contributions toward achieving federal missions and goals are often less visible than spending programs, which are subject to more systematic review. One reason for this is that they often operate, in practice, like entitlement programs not subject to annual appropriations. Since 1994, GAO has recommended greater...

Multiple Title IV programs and tax expenditures provided substantial aid to populations across income levels. In 2009, 12.8 million students received Title IV aid, and approximately 18-million tax filers claimed a higher education tax benefit for current expenses. Recent increases in both programs from 2008 to 2009 may be because of enrollment increases and legislative actions, among other factors...

The tax credit for qualified research expenses provides significant subsidies to encourage business investment in research intended to foster innovation and promote long-term economic growth. Generally the credit provides a subsidy for research spending in excess of a base amount but concerns have been raised about its design and administrability. Government Accountability Office (GAO) was asked t...

Numerous federal programs, policies, and activities are supported through the tax code. As described in statute, tax expenditures are reductions in tax liabilities that result from preferential provisions, such as tax exclusions, credits, and deductions. They result in revenue forgone. This report, done under the Comptroller General's authority, is part of an effort to assist Congress in reexamini...

How does the IRS ensure that your taxes are accurate? The IRS gets information from employers, banks, and other third-parties about your income and other factors that can affect your tax bill. Mismatches between this information and what you report on your taxes can indicate errors or potential fraud. The IRS processes billions of third-party information returns. But the system isn't managed strat...

Congress created Opportunity Zones to spur investment in distressed communities. About 10% of Americans live in the nearly 9,000 zones. In these areas, certain business investments can bring significant tax benefits to the investor. Unlike other, similar tax incentives, there is no limit on the amounts investors can claim for tax breaks. But how will opportunity zone investments actually affect th...

Even before COVID-19, the federal government's long-term fiscal path was unsustainable because debt was growing faster than the economy. By the end of FY 2019, debt held by the public had climbed to 79% of GDP. It is expected to reach 195% of GDP by FY 2050. We testified that the federal government does not have a long-term fiscal plan to control the growing debt. Such a plan could benefit from fi...

When a plant or company closes down or moves, there are some federal programs to help workers adjust to losing their jobs. For example, the Appalachian Regional Commission (ARC) and the Department of Labor both give state and local organizations grants to provide job training and counseling services. We reviewed these grants and found that: Labor did not process some grant applications in a timely...

For 3 decades, citizens of Micronesia, the Marshall Islands, and Palau have been able to live and work in the U.S. indefinitely without a visa through special agreements called compacts. The number of people who migrate to the U.S. under the auspices of these compacts has grown by about 70% in the last decade, particularly on the mainland. U.S. areas reported rising costs of public education and...

Each year, we make more than 1,000 recommendations to help improve the federal government. We alert department heads to the recommendations where they can save the most money, address issues on our High Risk List, or significantly improve government operations. This report outlines our 31 priority open recommendations for the Department of the Treasury as of April 2020. Twelve are to improve the...

Improper payments—those made by the federal government to the wrong person, in the wrong amount, or for the wrong reason—are a significant problem. In fiscal year 2019, government-wide improper payment estimates totaled about $175 billion. The law requires certain agencies to develop and monitor ways to reduce improper payments and take corrective actions to target their root causes. However,...

This report provides an update on the federal government’s fiscal condition at the end of FY 2019 and the unsustainable path it is on if policies don’t change. Among its findings: Publicly held debt rose to 79% of GDP. The Congressional Budget Office and this new report both project it will continue to grow Interest on the debt is the fastest growing item in the budget; it is projected to b...

We testified about the federal government’s fiscal condition at the end of FY 2019 and the unsustainable path it is on if policies don’t change. Among our findings: Publicly held debt rose to 79% of GDP. The Congressional Budget Office and our new report both project it will continue to grow Interest on the debt is the fastest growing item in the budget; it is projected to be the largest sp...

In fiscal year 2019, agencies across government made an estimated $175 billion in improper payments—payments that should not have been made or were made in the incorrect amount. But this total comes from individual agency estimates, which aren’t all reliable. We also looked at inspectors general reports on agencies’ compliance with a law intended to address improper payments. The law has se...