The first-time home buyer tax-credit that expired in May and was originally put in place by Congress in an attempt to revitalize a struggling economy and housing market apparently fell into the wrong hands on multiple occasions. 14,100 occasions actually. According to an investigator for the US government, 1,300 inmates took advantage of the tax-break costing the country $26.7 million. One of the scams used had taxpayers filing for the credit 67 times on one home sale (Associated Press).
The Internal Revenue Service (IRS) is supposedly looking into the matter and is disturbed by its implications. The IRS claims that due to its aggressive actions they have denied 400,000 questionable claims and opened 150 criminal investigations. This did not alter the fact that prison inmates still were able to cash in on the $8,000 tax credit. 241 of these inmates are serving life-sentences. Apparently prisons are not required to provide information on inmates to the IRS and many do not. The IRS is asking them now to expedite the investigation.
According to the National Association of Realtors, the tax-credit enabled the sale of 1 million homes that would not have been possible without it. Hopefully the IRS can uncover all the wrong-doers and expose all the fraudulent claims so as not to take away from those of us that honestly deserve these kind of breaks.
