The Internal Revenue Service plans to step up its reviews of taxpayers who take the mortgage interest deduction and target some for audit.
The Treasury inspector general for tax administration released a memo Monday announcing plans for the review, pointing out that there are thousands of homeowners who paid more than $20,000 in mortgage interest in 2005 who either failed to file a tax return or reported income that was less than would have been required to pay their mortgage and other basic living expenses.
The move is not without its critics.
We shouldn't presume that these struggling families are tax cheats just because they continue to make their mortgage payments despite losing their income, says Rep. Charles Boustany (R-La.), the top minority member of the House Oversight Subcommittee.
Source: The Wall Street Journal, Martin Vaughan (09/01/2009)