The First-Time Home Buyer Tax Credit is a dream come true for individuals planning to purchase their very first residential property. The credit is designed to provide tax relief to people taking their first step on the housing ladder. It is such an appealing prize, apparently, that it drove two Boston brothers to commit tax crimes to obtain more tax credits than they were entitled to.
The pair, along with their wives, were charged with falsely claiming the First-Time Home Buyer Tax Credit and making false statements on mortgage applications. The two brothers, who are 32 and 29, recently pleaded guilty in United States District Court in Boston. The brothers were officially charged with conspiracy to commit wire fraud. The eldest brother was also charged with several counts of submitting false statements or claims to the IRS.
The brothers perpetuated their scheme by enlisting accomplices to purchase properties on their behalf. These “straw purchasers” would then receive the First-Time Home Buyer Tax Credit and split the proceeds with the brothers. It was all a ruse, however, because the brothers were the real purchasers all along.
One law enforcement official told reporters that falsifying tax returns and attempts to abuse the tax credit are considered to be serious crimes. While the brothers may have made their choices in the effort to protect themselves financially, their decisions could cost them dearly. All of the parties involved could be sentenced to prison time and/or face substantial fines when they are sentenced. It is possible to make a move in regards to your taxes that you don’t think is wrong and to later learn it was not a good idea. In this situation, you might want to speak with an experienced tax attorney. Such an attorney likely has the knowledge to handle complex tax issues such as the one in this instance.
Source: Eagle Tribune, “Methuen brothers admit home buyer tax-credit fraud,” Jonathan Phelps, 07 July 2011.