Mr. Chairman, thank you for yielding time. I want to thank you for holding this hearing. When the Ways and Means Committee and the tax code are used for purposes beyond raising the revenues necessary to fund the federal government – for instance, to pursue social and economic policy goals – the members of this Subcommittee have a responsibility to conduct oversight of those tax provisions just as the Appropriations Committee conducts oversight of the programs it funds, to ensure that precious resources are being used effectively and honestly.
We are holding this hearing today to review the administration of the first-time homebuyer tax credit, examine allegations of fraud in claiming this refundable credit, and consider possible legislative changes to the credit. The credit expires at the end of next month, and a debate is heating up here in Congress over whether we should extend it, for how long, and with what modifications.
Determining whether or not we should extend the credit is not the purpose of this hearing today. But every time Congress creates a new refundable credit – meaning that individuals can get a check from the government whether or not they have actual tax liability – the incentive for fraud is magnified, as we have seen for example with the high percentage of erroneous claims for the earned income tax credit, and with the recent videos showing ACORN officials advising people on how to fraudulently claim refundable child credits. Therefore, this Subcommittee has a responsibility to figure out how we can minimize the opportunities for fraud and be good stewards of the taxpayers’ money.
If Congress decides to extend the homebuyer tax credit, both Chairman Lewis and I believe Congress should consider reasonable proposals to reduce fraud and improve the IRS’s ability to administer the credit. In addition, given the worsening fiscal crisis our government faces, I believe any extension of the homebuyer credit should be paid for by reducing wasteful spending elsewhere in the budget, such as cancelling ineffective stimulus funding that hasn’t yet been spent.
Finally, I want to echo Chairman Lewis’s comments commending Ms. Stiff for her 30 years of dedicated service to the American people. Congratulations on your well-deserved retirement, Ms. Stiff, and best of luck in your future endeavors. I look forward to hearing your thoughts, and the thoughts of our other witnesses, this morning.
Thank you, Mr. Chairman. I yield back.