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1300 Convicted Prisoners Receive $8,000 First Time Homebuyer Tax Credits

By
Real Estate Agent

Real Estate Professionals often lament about mortgage lenders that provided liar loans and mortgages to otherwise unqualified homebuyers, and helped kick-start the housing crisis we presently find ourselves in.  But how about adding salt to the wound by finding out the IRS actually sent $9 million in First Time Homebuyer Tax Credits to 1300 convicted prisoners across the country!

Ya gotta love Mike Leury of Sacramento TV station KOVR Channel 13.  And that's even if you don't live in Sacramento, and are located most anywhere around the country.  Mike has a special knack for uncovering outrageous boondoggles - such as this one, which he covers in a news segment titled, "On The Money." 

This evening, Leury reported on the government disclosure - an audit by the federal government, which found the 1300 inmates nationwide, collected the millions, which were supposed to help stimulate the economy.  Some prisoners were serving life sentences. 

Along with the two million folks who bought homes due to the popular First Time Homebuyer program, hundreds of convicted criminals also managed to collect the $8,000 tax credits while sitting in prison.

If folks are scratching their heads and wondering how prisoners were able to receive refunds for homebuyer credits on their tax returns, the federal audit discloses, "It's because Internal Revenue Service prisoner files are incomplete."

The IRS is trying to recapture the $9 million in wrongly collected funds.

For the complete story as presented by Mike Leury, you can access his "On The Money: Inmate Homebuyers?" report.

In another blog, "We Should Be Mad as Hell and We Shouldn't Take it Anymore," which I titled a few days ago, I addressed another of Leury's reports which exposed California State Lands Commission failure to collect rent on 500 acres of land for twelve years from USS-Posco, as well as rents for six years from an oil company on a pipeline crossing state lands - Boondoggles that cost the state California millions in lost revenue.

Posted by

Myrl Jeffcoat ActiveRain Signature
  

Comments (48)

Myrl Jeffcoat
Sacramento, CA
Greater Sacramento Realtor - Retired

Chris - It's rather mind-boggling, isn't it!  I'm waiting with baited breath to hear the number of dollars they are able to recover. . .You'll notice, I didn't say I was HOLDING my breath!

Aug 25, 2010 07:51 AM
Wayne Johnson
Coldwell Banker D'Ann Harper REALTORS® - San Antonio, TX
San Antonio REALTOR, San Antonio Homes For Sale

With all the hoops legitimate Buyers have to jump, you'd think this is impossible. It seems to me some on the outside are actively aiding this scam. They need ro join the convicts. I'll be reblogging this.

Aug 25, 2010 09:29 AM
Myrl Jeffcoat
Sacramento, CA
Greater Sacramento Realtor - Retired

Wayne - I had those same thoughts.  In order for that money to be spent, they would need help on the outside.  But of course there are sometimes spouses and family.  They need to be held accountable.  Thank you for reblogging!

Aug 25, 2010 10:12 AM
Bruce Walter
Keller Williams Realty Lafayette/West Lafayette, Indiana - West Lafayette, IN

Myrl, great story, and I love investigative reporting like that.  Now that is news instead of just giving us their commentary on something that has already happened.

I am sure the inmates will give the money back afterall they don't want to end up in prison!   ^_~

Aug 25, 2010 08:45 PM
The Scott Loper Team Bux-Mont Premier Properties
Keller Williams Real Estate - Montgomeryville - Lansdale, PA

Hi Myrl,

Ironic since I just read your blog about the pitfalls using social media.  And we're worried about saying the wrong thing or innocently committing a real estate commission violation in our interactions...  yet the fraud and mismanagement live on.

~Lisa

Aug 25, 2010 10:39 PM
Brigita McKelvie, Associate Broker
Cindy Stys Equestrian and Country Properties, Ltd. - Lehigh Valley, PA
The Broker with horse sense and no horsing around

Hi, Myrl,

That is totally outrageous, but only our government can do something like that.  It's amazing how easily these prisoners were able to collect the money and those of us that are honest have to jump through hoops to get it.  Hmmmm.  What's wrong with this picture?  No wonder our country is in debt.

Brigita

Aug 26, 2010 12:36 AM
Myrl Jeffcoat
Sacramento, CA
Greater Sacramento Realtor - Retired

Bruce - It is expose' reports like this one, that can put newsmedia at their best! 

Lisa - It really is an irony isn't it. We school so carefully to keep things accurate, and work to prevent any misdeed.  Yet we see it going on all around us.

Aug 26, 2010 01:42 AM
Myrl Jeffcoat
Sacramento, CA
Greater Sacramento Realtor - Retired

Brigita - The ease in which 1300 prisoners were able to get the tax credit, is what floored me.  Documentation was required, returns needed to be filed.  Unbelievable!

Aug 26, 2010 01:44 AM
Mary Douglas
United Country Ponderosa Realty, Red Feather Lakes, Colorado - Red Feather Lakes, CO
REALTOR, Red Feather Lakes, Colorado

Hi Myrl, leave it to the convicts...this is beyond me.  I guess because I'm just one of the honest working slobs that pay and pay and pay.....don't get me started!

Aug 26, 2010 02:44 AM
Myrl Jeffcoat
Sacramento, CA
Greater Sacramento Realtor - Retired

Mary - I hear ya loud and clear!  Knowing what it took for homeowners to collect that tax credit, makes me wonder what kind of documentation was supplied to the IRS, for the prisoners to receive it.  It's mind blowing!

Aug 26, 2010 12:43 PM
Andrea Swiedler
Berkshire Hathaway HomeServices New England Properties - New Milford, CT
Realtor, Southern Litchfield County CT

Myrl, I am shocked. Well, ok, not shocked at all. Angry is more like it. Wow.... wow, and wow again. 3 squares a day, no worry about rent or mortgage payments, no threat of going hungry or having the power shut off, then we hand 'em 8 grand... wow.... again.

I don't buy the excuse they didn't have enough timen to prepare. They don't take excuses from any tax payers....

I'm just sayin....

Aug 26, 2010 01:37 PM
Myrl Jeffcoat
Sacramento, CA
Greater Sacramento Realtor - Retired

Andrea - I'm having difficulty choking that one down too!  None of it really computes!  $8,000 is a whole lot of cigarettes.

Aug 26, 2010 01:52 PM
Ellie McIntire
Ellicott City Clarksville Howard County Maryland Real Estate - Ellicott City, MD
Luxury service in Central Maryland

Myrl- It looks like Mike Leury should be snapped up by a National TV station so we can all benefit from his hard core journalism. This is OUTRAGEOUS.

Aug 27, 2010 05:25 AM
Myrl Jeffcoat
Sacramento, CA
Greater Sacramento Realtor - Retired

Ellie - I wish Leury could be snapped up by National TV too. . .But I really enjoy having him around here:-)

Aug 27, 2010 06:22 AM
Barbara S. Duncan
RE/MAX Advantage - Searcy, AR
GRI, e-PRO, Executive Broker, Searcy AR

Investigative reporting is what the newspaper business and TV news business should be about.  Without them, I'm not sure where this country would end up.  Great story and thanks for passing it on.

Aug 28, 2010 02:53 PM
Geri Sonkin
Douglas Elliman Real Estate 516-457-7103 - Merrick, NY
Long Island Real Estate & Staging Expert

I just did a double take when I read your headline.  If it weren't so sad, it would be hilarious.

Aug 28, 2010 03:04 PM
Myrl Jeffcoat
Sacramento, CA
Greater Sacramento Realtor - Retired

Barbara - It truly is. . .As angry as some folks get at the news media, without the free press, the ruling class would essentially have their way with us. . .They almost do anyway!

Aug 28, 2010 05:15 PM
Myrl Jeffcoat
Sacramento, CA
Greater Sacramento Realtor - Retired

Geri - It's definitely an "If we didn't laugh, we'd cry" type of scenario isn't it!

Aug 28, 2010 05:16 PM
Todd Clark - Retired
eXp Realty LLC - Tigard, OR
Principle Broker Oregon

And we wonder why our deficit keeps getting larger and larger, the government has no clue where the money they send out every day is really going and for what.

Sep 05, 2010 06:25 PM
Myrl Jeffcoat
Sacramento, CA
Greater Sacramento Realtor - Retired

Todd - I have come to believe that our government is increasingly becoming out of control!  The left hand doesn't know what the right hand is doing.  And many of the agencies clearly aren't performing the job they were intended to do.  I also believe the two party system is so engrossed in special interests, that they leave most Americans away from any real representation.  Its party first, and country last!

Sep 05, 2010 06:34 PM