Check this one out.
What could be better to spice up the debate over whether to extend the home buyer tax credit than some good old fashioned fraud?
Thousands may have illegally scammed the federal government to cash in on the $8,000 tax credit, whether or not they qualified or had even bought a home, a treasury department inspector told lawmakers Thursday.
There’s even the case of tots being used to claim the credit by greedy parents who make too much to qualify. (The cap is $150,000 for couples, $75,000 for individuals.)
You couldn’t make this stuff up.
Anyway, according to BusinessWeek, it was not just one four-year-old, but multiple small children who got pushed into this scam. All told, 580 children under the age of 18 claimed $4 million in tax credits.
These, of course, were just the most outrageous of what looks to be thousands, if not tens of thousands, of cases of people outwitting what appears to be a pretty dimwitted federal bureaucracy.
More than 19,000 people filed tax credit claims totaling $139 million for homes that had not yet been purchased or never were.
Another 74,000 appear to have filed for the credit, even though they were not first-time home buyers and has bought in the past, the Wall Street Journal reports. That's another $500 million down the drain.
The IRS is now swinging into gear, freezing 10,000 refunds and launching 115 criminal investigations.
Wow, so glad the feds are finally on the case. Instead of launching a mythical sounding "115 investigations,'' maybe the taxmen could simply focus their efforts on one big probe and getting that right.
Of course, the obvious question is whether this emerging scandal will be enough to derail the fierce real estate industry lobbying campaign in Washington to win an extension of the credit, set to sunset this fall.
Probably not, though the home buyer tax credit has just lost some of its sheen. Rather, lawmakers crafting extension legislation are now pledging to put some “safeguards’’ into the bill.
Wonder what those are? Well, get this, these involve requiring taxpayers to attach documents showing they purchased the home and that they actually are the age they claim to be.
Sounds so obvious you have to wonder why these “safeguards’’ were not put into place before.
Anyway, I’m feeling better already. How about you?
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