Admitting parents tax fraud

mom2collegekids
Sun, 17 Jul 2016 21:21:58 +0000

Yes, the student needs to steer clear of this.

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According to the IRS, many married couples commit fraud to get the EITC. The couple divides up the kids, and each parent files as Head of Household. The IRS estimates around one quarter of EITC payments are paid as the result of error or fraud. <<<

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This sounds like what’s going on. Each parent has a child on his/her “head of household” taxes to get the EITC. And it sounds like the stepdad has this student on his taxes…which raised a red flag to the FA office because he’s not a bio parent.

If that’s what’s going on, then each year, this family is getting $9k-12k+ in tax credits that they wouldn’t otherwise get. If this has been going on for a few years, they could owe $50k+ plus penalties.

If that’s what’s going on, the parents aren’t going to “come clean”.