WASHINGTON, D.C. - A report released today by the Treasury Inspector General for Tax Administration (TIGTA) found new instances of fraud involving the first-time homebuyer credit on 2008 tax year returns. The issue of fraud in the homebuyer program was first revealed on Oct. 22, 2009, at a Ways and Means Oversight Subcommittee hearing. Subsequently, on November 6, 2009, President Obama signed into law legislation drafted by Oversight Subcommittee Chairman John Lewis to give the IRS additional authorities to combat fraud revealed by the Inspector General in its first interim report on the program.
“Last year, we learned that children and persons who did not purchase homes were fraudulently claiming the first-time homebuyer credit," said Rep. John Lewis (D-GA), Chairman of the Ways and Means Oversight Subcommittee. “In response, we provided additional authority to the IRS to administer the program. Although I am pleased that the fraud identified earlier does not continue, I am concerned about prisoners claiming the credit. I am also disturbed by 67 people claiming the credit for a single address and millions of dollars claimed by people who purchased homes before the program started. The report highlights the need to remain vigilant in this area. We are committed to working with the IRS and TIGTA to address and eliminate fraud with respect to all Federal tax provisions."
Among other items, the Inspector General’s report found that:
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1,300 prison inmates received more than $9 million of fraudulent credits;
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Thousands of taxpayers used the same homes to claim more than the maximum credit, including one home that was claimed by 67 taxpayers; and
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About 2,500 people claimed $18 million for homes purchased before the law went into effect.
