Cassidy, GOP colleagues seek answers on IRS management of EV tax credits

U.S. Sen. Bill Cassidy (R-LA) and more than a dozen of his Republican colleagues want to know how the Internal Revenue Service (IRS) is enforcing a nationwide electric vehicle (EV) tax credit.

A September 2019 audit by the U.S. Treasury Inspector General for Tax Administration details alleged systemic problems with awarding plug-in electric drive motor vehicle tax credits, according to a Jan. 27 letter from Sen. Cassidy and 14 other senators sent to IRS Commissioner Charles Rettig.

The inspector general reported on Sept. 30, 2019, that 16,510 individual tax returns received potentially erroneous EV tax credits between 2014 and 2018, according to the letter, which also said that if the correct IRS controls were in place, claims totaling more than $81 million could have been disallowed.

Moreover, the senators wrote that while the inspector general reported that the IRS has taken some steps to address its prior recommendations, “many of the deficiencies previously identified still exist.”

For instance, Sen. Cassidy and his colleagues pointed out that in 2011, the inspector general released an audit finding $33 million in tax credits for plug-in EVs were awarded to individuals who owned vehicles that did not qualify.

Sen. Cassidy and his fellow senators wrote, “… Despite recognizing this fraud eight years ago, it has not only persisted but become even more widespread.” As a result, the lawmakers said they requested information about what appears to be systemic problems with the tax credit program.

“It is troubling that these improper payments continue and have more than doubled in size in the eight years since they were first reported,” wrote Sen. Cassidy and his colleagues, who included U.S. Sens. Joni Ernst (R-IA) and Thom Tillis (R-NC).

“The apparently systemic problems with the electric vehicle tax credit are even more concerning as Congress considers a potential $16 billion expansion to the program, which overwhelmingly benefits wealthy electric vehicle owners in one state,” the members wrote.