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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There is something dubious about the government’s homebuyer tax credit from the very start. It actually did more harm than good and now that the proposed extension is unlikely to materialize, the housing market is left in shambles. And with this latest development concerning fraud, you can’t help but wonder what’s going on…if this issue escalates further then heads must roll…
Miami Condo Shop,
I’ve posted before that I thought the tax credit was iffy. Basically it was just an extension of the “spend borrowed money” that got us into the mess to begin with. I don’t see all of this money “trickling down” as many economics camps would put it.
Also, who’s to say that the purchase and sale agreements that were executed weren’t ‘back dated’ to accommodate both buyers and sellers?
Good post…wish more people were making a bigger stink about this holes and problems with the tax credit issues. We had a pretty decent response to the credit here in Hilton Head Island. Love the 34 IRS agents…nice!
The Homebuyer Tax Credit was good first in the beginning. The house and the finance market need help from the Government in that time, but now have it go to far. It’s sad, like everything after a while come the criminal, when they know how the system works.
i was just reading in depth review of this tax credit and how much it’s hurting the industry right now. feels like second wave coming that is even bigger then first. makes you think if one huge wave would have been better then two big ones. not sure how all its going to finish but so far it does not look good at all.
Vancouver,
I’d like to see that review. Could you post a link?
We may look back on the tax credit in a few years and think it was the worse thing that could have happened to the real estate industry.
The tax credit has been one of many small bandaids on a much larger problem.
This is really a great informative post.Thanks for providing such an awesome post with us.
This is very alarming! How can the US government be so lenient with the tax credit applications? I wondered how was the screening done that there were a lot of loopholes that came through? This only shows that the presence of corruption simply doubles, especially with the hard economy that everyone is experiencing. It’s quite sad to see a country go corrupt in times of adversities!
Informative post with lots of useful details. Thanks for providing us such an excellent article.
Thanks for the post, helps us all.
What a great post. Hopefully all get caught and have to pay for their stupidity. No one thought they were smart enough to catch the crooks!
That’s really not right people are claiming credits for the same home. I wish those people wouldn’t end up having a bad KARMA because of what they have done.
“It’s quite sad to see a country go corrupt in times of adversities!”… you’re surprised? There is always a way for people to take advantage of a good thing and there are always people out there that are going to. It’s sad, but unfortunately there is no way to stop it. The IRS was getting so many tax credit apps they weren’t doing their due diligence to make sure every one of them was legit. There was a LOT of money wasted and i can’t believe 67 people received the tax credit on the same home…. gee i wonder if they all had ties?
Great information. It’s crazy to think just how ineffective our government is to allow this kind of stuff. Grrrr.
It’s crazy to think how ineffective our government is and has been for a long time not only with the tax credit fiasco, but with everything else. Ok, little off topic but it really irks me that people can get away with ridiculous acts of greed such as this.
I find it heartwarming to know that you can still cheat on taxes even when you are serving a light sentence. It just goes to show that America is full of opportunities for everyone, and that you can always find a ray of sunshine in even the most difficult circumstances.
That’s shocking but a very interesting read. It will soon catch up to them!!
strange as it may sound i’ve never seen a rotten apple still hanging from a tree, guess that’s the downside to living in the city.
first of all thanks for great post! its really worth reading. but the fraud comparison with the apple was interesting
Wow, that’s a lot of fraud. I would have never guessed. Thanks for sharing and enlightning us.
Basically, as usual it’s the government fault. They administered it , they should have a system of checks and balances and this wouldn’t happen.
That’s a lot of informative sights! Thank you for posting this! Although it is very strange but it has an idea that enlighten us!
The fraud and waste in country today continues. The bereaucracy is incredible.
That’s very sad to hear. It’s rampant now a days. Hopefully all get caught and have to pay for their stupidity.
Good post as I liked a lot.Its very good and useful.Very informative and useful
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