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TIGTA Report Uncovers Homebuyer Credit Fraud

 

A recent report released by the Treasury Inspector General for Tax Administration (TIGTA) reveals that additional steps are necessary to prevent fraud and abuse with regard to the first-time homebuyer credit. It should have come as no surprise that a refundable credit of as much as $8,000 would cause some individuals to fabricate information to make it appear they were eligible. According to the report, as many as 4,600 incarcerated individuals filed claims for the credit. Apparently, at least 1,295 prisoners were allowed to receive more than $9.1 million in credit refunds related to the first-time homebuyer credit. The IRS has plans to recover the money.

The results of this report could mean that the IRS steps up its audits of returns on which the credit was claimed.

The full report is available on TIGTA’s website.


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