A Treasury Department report has revealed that around $9.1 million in tax credits intended for first-time homebuyers have been used by prisoners. The report, conducted by the Treasury’s inspector general, found that over 240 inmates serving life sentences were among nearly 1,300 prisoners who allegedly defrauded the government.

Prisoners’ usage of the first-time home buyers’ tax credit program, which entitled buyers up to $8,000 in tax credits, was only the cherry on top. The report also found out that a total of $28 million was disbursed with irregularities. Thousands of applicants filed multiple claims while other made claims even after the deadline of filing expired on April 30.

“Additional controls are necessary to address erroneous claims for the credit. Further, fraudulent and questionable claims processed prior to implementation of controls will need follow-up action by the IRS (Internal Revenue Service),” the report recommended.

The Treasury report said that 4,608 state and federal inmates filed for tax credits. Of the total, 1,295 of them were approved. Included in the total number of applicants are 715 prisoners who were serving life sentences. Some 241 of them were awarded $1.7 million in tax credits. The report also noted 174 prisoners who filed for the tax credit with the help of paid preparers.

More than 60% of life sentence prisoners were from Florida. Jo Ellyn Rackleff, spokeswoman for the Florida Department of Corrections, said it was probably because the state was transparent to the ORS on inmate information.

“It is possible for an inmate to buy a house while in prison,” she commented.

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