First-time homebuyers get $8,000, IRS keeps eye on things - KLTV.com - Tyler, Longview, Jacksonville |ETX News

First-time homebuyers get $8,000, IRS keeps eye on things

By Layron Livingston - bio | email
Posted by Ellen Krafve - bio | email

TYLER, TX (KLTV) - The deadline is looming for first time homeowners to get an $8,000 tax credit. However, it appears not everyone claiming that tax credit actually qualifies and the IRS is watching.

More than a million IRS claims...and about $10-billion dollars later, it turns out thousands of those "first time homebuyers" owned homes before or claimed homes they didn't actually buy. The fraud is putting taxpayers and tax preparers square in the sights of the IRS.

"There's always people out there that's trying to cheat and avoid the rules," said Lisa Robinson, a CPA.

For now, single buyers making $75,000 a year, or couples making $150,000 have until November 30th to close on their homes. If they've owned a home within the past three years, they don't qualify.

"Legitimate tax preparers would not file a refund claim for a four-year-old on a first time home buyer," said Robinson. "It just doesn't really pass the smell test."

Tyler CPA, Lisa Robinson says responsible tax preparers will ask for documents to support the tax credit claim: W-2's and tax returns. Margie Fisher with Primelending says if a borrower is committing fraud, most of the time, it gets caught.

"I think it was just lack of understanding, lack of knowledge," said Fisher. "[They] tried to pass off a W-2 to us that actually wasn't a real one."

The Homebuyer Tax Credit Improvement Act was introduced last week to curb some of the fraud. It would set the minimum age to file a claim at 18. Taxpayers would also have to include paperwork proving they bought a home. And, no one wants a few bad applications to spoil the entire homebuying bunch. Congress is considering extending the program to all buyers through next spring. It's reported Congress is also considering loosening the income requirements for the credit. Meanwhile, the IRS has frozen more than 100,000 refunds. Dozens are pending investigation.

©2009 KLTV. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

Powered by Frankly