September 18, 2020

A Lifetime Prison Sentence Won’t Prevent You from Qualifying for the Homebuyer Tax Credit

Oh the glorious first-time homebuyer tax credit. Championed by Congressional Leaders, popular with Americans and ripe with fraud.

No legislation is perfect though, amiright? You’ve got to take the good with the bad. The latest of the bad comes courtesy of everyone’s favorite bureaucratic nagging mother-in-law, the Treasury Inspector General for Tax Administration. The TIGTA has come out with a new report that shows that the FTHBTC program hasn’t really gotten any better at weeding out the unscrupulous activity.

TIGTA estimates that 14,132 individuals received erroneous credits totaling at least $26.7 million. These erroneous credits included:

• 2,555 taxpayers receiving credits totaling $17.6 million for homes purchased prior to the dates allowed by law.

• 1,295 prisoners receiving credits totaling $9.1 million who were incarcerated at the time they reported that they purchased their home. These prisoners did not file joint returns, so their claims could not have been the result of purchases made with or by their spouses. Further, TIGTA found that 241 prisoners were serving life sentences at the time they claimed that they bought new primary residences.

•10,282 taxpayers receiving credits for homes that were also used by other taxpayers to claim the credit. (In one case, TIGTA found that 67 taxpayers were using the same home to claim the credit.) TIGTA auditors have not fully quantified the total of these erroneous credits, but all indications are that the total will be in the tens of millions of dollars.

But wait! There’s good news! Inspector General J. Russell George was happy to report that there has been improvements, “The good news is that the IRS has made significant strides resolving problems associated with this program. For example, no minors received the Credit, according to our report.”

Progress! They’ve managed to keep the under-eighteen crowd under control. But do we prefer this to prisoners doing life getting our tax dollars? Seems like a toss-up.

Errors, Fraud Still Occur in First-Time Homebuyer Credit Program [TIGTA]

Oh the glorious first-time homebuyer tax credit. Championed by Congressional Leaders, popular with Americans and ripe with fraud.

No legislation is perfect though, amiright? You’ve got to take the good with the bad. The latest of the bad comes courtesy of everyone’s favorite bureaucratic nagging mother-in-law, the Treasury Inspector General for Tax Administration. The TIGTA has come out with a new report that shows that the FTHBTC program hasn’t really gotten any better at weeding out the unscrupulous activity.

TIGTA estimates that 14,132 individuals received erroneous credits totaling at least $26.7 million. These erroneous credits included:

• 2,555 taxpayers receiving credits totaling $17.6 million for homes purchased prior to the dates allowed by law.

• 1,295 prisoners receiving credits totaling $9.1 million who were incarcerated at the time they reported that they purchased their home. These prisoners did not file joint returns, so their claims could not have been the result of purchases made with or by their spouses. Further, TIGTA found that 241 prisoners were serving life sentences at the time they claimed that they bought new primary residences.

•10,282 taxpayers receiving credits for homes that were also used by other taxpayers to claim the credit. (In one case, TIGTA found that 67 taxpayers were using the same home to claim the credit.) TIGTA auditors have not fully quantified the total of these erroneous credits, but all indications are that the total will be in the tens of millions of dollars.

But wait! There’s good news! Inspector General J. Russell George was happy to report that there has been improvements, “The good news is that the IRS has made significant strides resolving problems associated with this program. For example, no minors received the Credit, according to our report.”

Progress! They’ve managed to keep the under-eighteen crowd under control. But do we prefer this to prisoners doing life getting our tax dollars? Seems like a toss-up.

Errors, Fraud Still Occur in First-Time Homebuyer Credit Program [TIGTA]

Have something to add to this story? Give us a shout by email, Twitter, or text/call the tipline at 202-505-8885. As always, all tips are anonymous.

Related articles

What COVID-19 Tells Us About … SALT

COVID-19 may be the newest exacerbator of high blood pressure in humans, and it is having an effect on another well-known catalyst for stress, SALT. But this is not your old-fashioned table variety we are referring to. In the accounting department at the University of Maryland’s Robert H. Smith School of Business where I teach, […]

Accountants Behaving Badly: KPMGer’s Racist Facebook Rant, Wife Killer Charged Again, Thankful For the Rona

Plus, serial embezzler sentenced to nearly three years in prison, and United Arab Emirates accountant jailed for money laundering. KPMG distances itself from manager’s ‘racist’ Facebook rant [Trinidad Express] Sachin Boodram, an audit manager at KPMG in Trinidad and Tobago, probably should’ve just stuck to posting selfies, inspirational quotes, and recipes on his Facebook page. […]