Homebuyer Tax Credit Fraud: 14,132 Bad Apples | General Homebuying Discussion | Boise Real Estate Forums

You've heard the idiom, "One bad apple spoils the whole bunch". But how many bunches get spoiled by 14,132 bad apples?

14,132 is the number of "Individuals who have received erroneous Home buyer Tax Credits totaling at least $26.7 million" according to the Treasury Inspector General for Tax Administration (TIGTA) report recently released.

Key findings in the report:

• 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.

Oh yeah, at least 34 IRS employees erroneously received the credit too!

I'm sure that as months progress, the total number will eclipse these 14,132 apples.

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Howard Flaschen said:

What truly sucks about this is that there may be the need for further government assistance over the next year or so in some regions.  Stories like this make it awfully hard to push anything through so you'll be looking at an inability to be sniper-like in striking certain areas of the economy that might need an injection.  It really sucks but I guess it's a part of the deal.

Howard, I think they need to just let the cards fall.  At some point, if we keep up with this type of tax credit incentive policy, people won'e make moves unit they know they're going to get a hand out.

I think it was an interesting attempt to breathe life into a market, but in order to fill up a deflated tire, you need to patch the holes.  Now, we get to find out what 'the holes' are.