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Testimony: 

Before the Subcommittee on Oversight, Committee on Ways and Means, 
House of Representatives: 

United States Government Accountability Office: 

GAO: 

For Release on Delivery Expected at 10:00 a.m. EDT: 

Thursday, October 22, 2009: 

First-Time Homebuyer Tax Credit: 

Taxpayers' Use of the Credit and Implementation and Compliance 
Challenges: 

Statement of James R. White, Director: 

Strategic Issues: 

GAO-10-166T: 

Mr. Chairman and Members of the Subcommittee: 

I appreciate this opportunity to comment on taxpayers' use of the First-
time Homebuyer Credit (FTHBC) and the Internal Revenue Service's (IRS) 
implementation and compliance challenges. 

As an important part of the recent economic stimulus efforts, Congress 
enacted the FTHBC to assist the struggling real estate market and 
encourage taxpayers to purchase their first home. The credit initially 
was enacted by the Housing and Economic Recovery Act of 2008 (Housing 
Act) and revised by the American Recovery and Reinvestment Act of 2009 
(Recovery Act).[Footnote 1] The 2008 FTHBC provided taxpayers a credit 
of up to $7,500 that must be paid back over 15 years. The Recovery Act 
increased the maximum credit for the 2009 FTHBC to $8,000, with no 
payback required unless the home ceases to be the taxpayer's principal 
residence within 3 years. This $8,000 credit is a refundable tax credit 
that is paid out even if there is no tax liability or the credit 
exceeds the amount of any tax due. 

The 2009 FTHBC was enacted into law on February 17, 2009, but 
eligibility was made retroactive for homes purchased beginning January 
1, 2009. See appendix I for a comparison of the 2008 and 2009 FTHBC. 

My testimony today, based on on-going work, describes two issues: 

* the extent to which taxpayers are using the FTHBC, including 
breakouts by state and income; and: 

* IRS's implementation and compliance challenges associated with both 
the 2008 and 2009 credits. 

To describe the extent to which taxpayers are using the FTHBC, we 
obtained and analyzed data from IRS about the use of the FTHBC and 
reviewed IRS documents. We ensured these data were reliable by 
reviewing IRS's computer programs for capturing the data and discussing 
the computer programming and verification processes with IRS officials. 
While combined 2008 and 2009 data appear reliable, the data for each of 
the years do not. This is because some claims were filed by taxpayers 
for the 2008 credit who actually could have claimed the 2009 credit, 
and IRS did not flag the problem. In following up on 47,276 
electronically filed returns that appeared not to have claimed the 
whole FTHBC, the Treasury Inspector General for Tax Administration 
(TIGTA) found that 93 percent, or 43,967, were not coded as a 2009 
FTHBC even though the purchase had occurred in 2009. It is likely that 
the errors are a result of (1) taxpayers who purchased a house in 2009 
prior to the passage of the Recovery Act and claimed the 2008 credit, 
when, in fact, they are eligible for the expanded benefits of the 2009 
credit; and (2) IRS's not properly coding the purchase date as a 2009 
FTHBC on some returns. IRS has plans to monitor instances where 
taxpayers claimed the 2008 instead of the 2009 credit. When those 
taxpayers do not file an amended return, IRS has plans to notify them 
as to their eligibility for the expanded benefits of the 2009 credit. 
According to IRS officials, IRS plans to correct the other errors when 
it begins enforcing the 2008 FTHBC payback provisions. At that time, 
IRS plans to verify the date of purchase and make any adjustments. 

To describe IRS's implementation and compliance challenges, we reviewed 
IRS documents and interviewed IRS officials to identify the guidance, 
outreach, and programming changes instituted to implement the credit. 
For this objective, we used several approaches to identify compliance 
challenges. Primarily, we reviewed IRS documents--including a risk 
assessment questionnaire, mitigation plan, and program decision 
document--to determine the risks associated with the credit and IRS's 
plans for mitigating them, and we reviewed previous GAO reports. We 
also consulted ongoing TIGTA audits on the credit. In addition, we 
interviewed officials from the Department of the Treasury and IRS's 
Wage and Investment division. 

We have been conducting performance audits on the 2008 filing season 
and on the tax provisions in the Recovery Act since January 2009, and 
June 2009, respectively, in accordance with generally accepted 
government auditing standards. Those standards require that we plan and 
perform the audit to obtain sufficient, appropriate evidence to provide 
a reasonable basis for our findings and conclusions based on our audit 
objectives. We believe that the evidence obtained provides a reasonable 
basis for our findings and conclusions based on our audit objectives. 

Over 1.4 Million Taxpayers Have Claimed about $10 Billion in FTHBC: 

According to preliminary data from IRS, as of August 22, 2009, over 1.4 
million taxpayers have claimed the FTHBC for homes purchased in 2008 
and 2009, as shown in table 1. This represents total foregone tax 
revenue of about $10 billion through August 22. 

While the combined 2008 and 2009 data appear reliable, as we noted the 
data for each year may be subject to revision because some claims made 
by taxpayers for the 2008 credit could have been made for the 2009 
credit. In addition, the figures for 2009 are incomplete for several 
reasons. First, the figures do not include some returns that have been 
received by IRS but not processed. Second, some taxpayers have already 
purchased a home but have not yet filed for the credit. Taxpayers can 
claim the 2009 FTHBC on their 2008 or 2009 tax return. Last, the 2009 
FTHBC does not expire until December 1, 2009, so taxpayers still have 
time to purchase homes and qualify for the credit. The Joint Committee 
on Taxation estimates that a majority of claims will occur in 2010 when 
taxpayers file their 2009 tax returns. 

With these caveats in mind, table 1 shows the 2008 and 2009 FTHBC 
claims. The 2008 credit numbers, while subject to revision as noted 
above, are likely to be of the correct order of magnitude. The 2009 
numbers should be interpreted as interim and are likely to change 
substantially. 

Table 1: Taxpayers Claiming the FTHBC in 2008 and 2009: 

Number of taxpayers claiming the FTHBC; Taxpayers claiming homes 
purchased in 2008: 1,041,361; Taxpayers claiming homes purchased in 
2009: 385,193; Total: 1,426,554. 

Dollar amount of credit claimed (in billions); Taxpayers claiming homes 
purchased in 2008: $7.108; Taxpayers claiming homes purchased in 2009: 
$2.89; Total: $9.998. 

Source: IRS data. 

Note: Data as of August 22, 2009. 

[End of table] 

Taxpayer Use of the FTHBC Varied by Income and State: 

Based on claims made to IRS as of August 22, 2009, 59 percent of 
taxpayers who claimed the FTHBC had an adjusted gross income (AGI) of 
less than $50,000, as shown in table 2. The FTHBC was 
disproportionately claimed by taxpayers in the $25,000 to $100,000 AGI 
range. About 74 percent of credit claimants were in this AGI range, as 
compared to 46 percent of all taxpayers who filed a tax return in 2007. 
The low percentage of taxpayers claiming the credit with over $100,000 
AGI reflects, in part, the income cap, for the FTHBC. For example, for 
joint filers the credit phases out between $150,000 and $170,000 (see 
app. I). 

Table 2: AGI of Taxpayers Who Claimed the FTHBC (2008 and 2009 
Combined) Compared to the AGI of All Taxpayers Who Filed a Tax Return 
in 2007: 

Total number of FTHBC claims[B]; 
AGI Ranges: Zero or less[A]: 25,200; 
AGI Ranges: $1 to $25,000: 265,283; 
AGI Ranges: $25,001 to $50,000: 543,996; 
AGI Ranges: $50,001 to $75,000: 352,474; 
AGI Ranges: $75,001 to $100,000: 152,054; 
AGI Ranges: Greater than $100,000: 87,547; 
AGI Ranges: Total: 1,426,554. 

Percentage of total FTHBC claims; 
AGI Ranges: Zero or less[A]: 2; 
AGI Ranges: $1 to $25,000: 19; 
AGI Ranges: $25,001 to $50,000: 38; 
AGI Ranges: $50,001 to $75,000: 25; 
AGI Ranges: $75,001 to $100,000: 11; 
AGI Ranges: Greater than $100,000: 6; 
AGI Ranges: Total: 100. 

Percentage of total taxpayers filing a tax return in 2007[C]; 
AGI Ranges: Zero or less[A]: 1; 
AGI Ranges: $1 to $25,000: 40; 
AGI Ranges: $25,001 to $50,000: 24; 
AGI Ranges: $50,001 to $75,000: 14; 
AGI Ranges: $75,001 to $100,000: 8; 
AGI Ranges: Greater than $100,000: 13; 
AGI Ranges: Total: 100. 

Source: GAO analysis of IRS data. 

Note: Percentages may not add due to rounding. 

[A] Taxpayers in the zero or less AGI range may be purchasing a home 
using savings or have income that varies across years. 

[B] Data as of August 22, 2009. 

[C] The 2007 data were the most current available for comparison 
purposes. 

[End of table] 

Looking at credit claims for each year separately must be done with 
caution because of the data issues described earlier. Comparing the 
preliminary 2009 data to the 2008 data shows an increase in the use of 
the credit by taxpayers with an AGI under $50,000 and especially by 
taxpayers with AGI under $25,000. For example, 18 percent of taxpayers 
who claimed the 2008 credit had an AGI of less than $25,000 compared to 
27 percent of taxpayers claiming the 2009 credit. See appendix II for 
more detail. It is not possible to know whether these patterns will 
change as more complete and accurate 2009 data become available. 

There are also differences in FTHBC claim rates among the states, as 
shown in appendix III. The highest number of FTHBC claims per capita is 
in Nevada, which has about three times the number of claims per capita 
than New York and Hawaii. Appendix III also shows the aggregate dollars 
claimed in each state and per capita dollars claimed. There is a strong 
correlation between state ranking of claims per capita and dollars per 
capita. 

IRS Faces Significant Implementation and Compliance Challenges Related 
to the FTHBC: 

IRS had to balance quick implementation of the FTHBC with enforcement 
of the laws' requirements. Although IRS routinely implements tax 
legislation, the 2008 and 2009 FTHBC pose significant implementation 
challenges because they occurred during the filing season and in 
conjunction with other multifaceted tax law changes. IRS quickly 
implemented the complex FTHBC legislation, allowing taxpayers to claim 
about $10 billion as of August 2009. For example, IRS: 

* issued a new form, the Form 5405--"First-Time Homebuyer Credit"--and 
new instructions for the Form 5405, and revised other related forms and 
instructions; 

* communicated with taxpayers and tax return preparers through a 
variety of avenues, such as news releases, postings on [hyperlink, 
http://www.irs.gov], podcasts, and YouTube videos; and: 

* made computer programming changes to enable processing for paper and 
electronically filed returns. For example, the 2009 credit required 
programming changes to accommodate the differences in the eligibility 
rules for the 2008 and 2009 credits.[Footnote 2] 

IRS faces significant challenges in determining if taxpayers are 
complying with the numerous conditions for the credit. For example, to 
determine eligibility, IRS must verify that taxpayers have not owned a 
house in the previous 3 years and verify the closing date on home 
purchases. Other challenges include enforcing the $500 per year payback 
provision in the 2008 credit. According to recent IRS data, up to $7 
billion could be repaid to the federal treasury over the 15-year period 
of this provision. 

One reason assuring compliance is a challenge is that IRS did not 
require substantiation, either by the taxpayer or from a third-party 
source, to validate the information on the Form 5405. For example, IRS 
decided that requiring taxpayers to attach supplemental documentation 
about a home sale to a tax return would be burdensome. Further, 
according to IRS officials, IRS does not have the ability to accept 
such documentation electronically, which could impede taxpayers' 
ability to file tax returns electronically.[Footnote 3] 

Initially, IRS put procedures in place to stop some FTHBC fraud and 
detect common mistakes so that returns could be sent back to taxpayers 
for amendment. The results of IRS's review of early FTHBC filings 
prompted IRS to implement new computer filters to further determine 
eligibility up front, prior to refund issuance. As a result of up-front 
pre-refund checks as of September 30, 2009, IRS had (1) frozen more 
than 110,000 refunds pending civil or criminal examinations, (2) 
identified 167 criminal schemes, and (3) begun 115 criminal 
investigations. 

IRS is also conducting post-refund FTHBC audits, but such audits are 
labor intensive for IRS, burdensome for taxpayers, and conducted after 
refunds are issued, making it more difficult for IRS to recoup the 
money. These audits address not only eligibility issues, but also 
recapture and payback issues for the 2009 and 2008 credits, 
respectively.[Footnote 4] Because of the complicated provisions 
governing the credits, IRS is still determining the extent to which 
enforcement will have to be done through post-refund audits versus pre- 
refund compliance checks. 

To reduce IRS's reliance on costly and burdensome audits, in a recent 
report we suggested the Congress consider providing IRS with additional 
legislative authority known as math error authority (MEA).[Footnote 5] 
MEA, which IRS has for some tax provisions, must be granted by statute 
for specified purposes. Using MEA, IRS identifies calculation errors 
and checks for obvious noncompliance, such as claims above income and 
credit limits. IRS corrects these errors during tax return processing, 
which avoids the need for audits. Specifically, we suggested that 
Congress consider giving IRS MEA to use tax return information to 
automatically verify taxpayers' compliance with the 2008 FTHBC payback 
provision and ensure that taxpayers do not improperly claim the credit 
in multiple years. 

It is too early to tell whether IRS's enforcement actions and the 
proposed new legal authorities will be enough to protect federal 
revenue. Because of the complexities and multi-year compliance issues 
associated with the credit, along with the potential for significant 
burden on taxpayers, continued oversight of IRS's enforcement efforts 
will be necessary. 

Agency Comments: 

In commenting on a draft of this testimony, IRS stated that the 
statement is very fair, presents a balanced picture, and gives a good 
perspective of where the agency is in the overall compliance cycle. IRS 
also provided technical comments which we incorporated where 
appropriate. 

Mr. Chairman, this concludes my prepared statement. I would be happy to 
respond to questions that you or other Members of the Subcommittee may 
have at this time. 

Contacts and Acknowledgments: 

For further information regarding this testimony, please contact James 
R. White, Director, Strategic Issues, on (202) 512-9110 or 
whitej@gao.gov. Contact points for our Offices of Congressional 
Relations and Public Affairs may be found on the last page of this 
statement. Individuals making key contributions to this testimony 
include Libby Mixon, Assistant Director; Joanna M. Stamatiades, 
Assistant Director; Sherwin D. Chapman; Andrea S. Clark; John P. 
Dell'Osso; Rachel Dunsmoor; Kirsten B. Lauber; Lawrence M. Korb; 
Natalie L. Maddox; Karen V. O'Conor; Neil A. Pinney; and Sabrina C. 
Streagle. 

[End of section] 

Appendix I: Requirements for the 2008 and 2009 First-time Homebuyer 
Credit (FTHBC): 

The 2008 and 2009 FTHBC have complex requirements. Regarding the amount 
of the credit, taxpayers generally can claim the smaller of: 

* $7,500 for the 2008 credit and $8,000 for the 2009 credit, or: 

* 10 percent of the purchase price of the home. 

Virtually all eligibility requirements for the 2008 and 2009 FTHBC are 
identical, as noted in table 3. However, there are three key 
differences, the primary one being the purchase date. 

Table 3: Eligibility Requirements for the FTHBC: 

Eligibility requirements: Date of purchase must be between April 9, 
2008 and June 30, 2009; 
2008 FTHBC: x; 
2009 FTHBC: [Empty]. 

Eligibility requirements: Date of purchase must be between January 1, 
2009 and November 30, 2009; 
2008 FTHBC: [Empty]; 
2009 FTHBC: x. 

Eligibility requirements: Home must be principal residence[A]; 
2008 FTHBC: x; 
2009 FTHBC: x. 

Eligibility requirements: Taxpayer must have no prior homeownership 
within the past 3 years; 
2008 FTHBC: x; 
2009 FTHBC: x. 

Eligibility requirements: Home cannot be a gift or inheritance; 
2008 FTHBC: x; 
2009 FTHBC: x. 

Eligibility requirements: Home cannot be acquired from a relative; 
2008 FTHBC: x; 
2009 FTHBC: x. 

Eligibility requirements: Home must be located in the United States; 
2008 FTHBC: x; 
2009 FTHBC: x. 

Eligibility requirements: Single filers: 
Modified adjusted gross income (MAGI) must be less than $95,000[B]; 
Between $75,000 and $95,000 the credit phases out; 
2008 FTHBC: x; 
2009 FTHBC: x. 

Eligibility requirements: Married filing jointly filers: 
MAGI must be less than $170,000; 
Between $150,000 and $170,000 the credit phases out; 
2008 FTHBC: x; 
2009 FTHBC: x. 

Eligibility requirements: Cannot claim the FTHBC in both 2008 and 2009; 
2008 FTHBC: x; 
2009 FTHBC: x. 

Eligibility requirements: Taxpayer cannot be a non-resident alien; 
2008 FTHBC: x; 
2009 FTHBC: x. 

Eligibility requirements: Taxpayer must not be or must not have been 
eligible to claim the District of Columbia homebuyer credit for any tax 
year; 
2008 FTHBC: x; 
2009 FTHBC: [Empty]. 

Eligibility requirements: Home financing cannot come from tax-exempt 
mortgage revenue bonds; 
2008 FTHBC: x; 
2009 FTHBC: [Empty]. 

Source: GAO analysis of FTHBC information. 

Note: The "x" indicates if the related eligibility requirement applies 
to FTHBC for homes purchased in 2008 or 2009. 

[A] A principal residence is the main home a taxpayer lives in most of 
the time. It can be a house, houseboat, housetrailer, cooperative 
apartment, condominium, or other type of residence. 

[B] MAGI is modified adjusted gross income (AGI), as figured on an 
income tax return, plus various amounts excluded from the income tax 
return, such as some types of foreign income that would have to be 
added to AGI to yield MAGI. 

[End of table] 

In addition to eligibility requirements, the 2008 credit has a 15-year 
payback provision, but the payback may be accelerated if the home is 
sold or is no longer the principal residence. In addition, payback is 
waived if certain conditions are met, such as when a taxpayer is 
deceased and not a joint filer. 

The 2009 tax credit has a recapture provision. If a house is resold or 
ceases to be the primary residence of the taxpayer within 3 years, the 
credit must be repaid. However, the recapture provision is limited to 
the amount of gain on the sale, so a taxpayer could sell within 3 years 
and still not owe repayment. There are exceptions to the recapture 
provision in the case of death, divorce, and involuntary conversion. 
Bills are currently under consideration in the Congress that would 
waive the recapture provision for members of the Armed Services if they 
are required to move. 

[End of section] 

Appendix II: Number of 2008 and 2009 FTHBC Claims and Adjusted Gross 
Income (AGI) Ranges: 

Table 4: Number of 2008 FTHBC Claims Filed and AGI Ranges: 

Number of 2008 FTHBC claims; 
Zero or less: 12,021; 
$1 to $25,000: 174,026; 
$25,001 to $50,000: 393,039; 
$50,001 to $75,000: 269,676; 
$75,001 to $100,000: 121,844; 
Greater than $100,000: 70,755; 
Total: 1,041,361. 

Percentage of claims; 
Zero or less: 1; 
$1 to $25,000: 17; 
$25,001 to $50,000: 38; 
$50,001 to $75,000: 26; 
$75,001 to $100,000: 12; 
Greater than $100,000: 7; 
Total: 100. 

Source: GAO analysis of IRS data. 

Note: Percentages may not add due to rounding; data as of August 22, 
2009. 

[End of table] 

Table 5: Number of 2009 FTHBC Claims Filed and AGI Ranges: 

Number of 2009 FTHBC claims; 
Zero or less: 13,179; 
$1 to $25,000: 91,257; 
$25,001 to $50,000: 150,957; 
$50,001 to $75,000: 82,798; 
$75,001 to $100,000: 30,210; 
Greater than $100,000: 16,792; 
Total: 385,193. 

Percentage of claims; 
Zero or less: 3; 
$1 to $25,000: 24; 
$25,001 to $50,000: 39; 
$50,001 to $75,000: 21; 
$75,001 to $100,000: 8; 
Greater than $100,000: 4; 
Total: 100. 

Source: GAO analysis of IRS data. 

Note: Percentages may not add due to rounding; data as of August 22, 
2009. 

[End of table] 

[End of section] 

Appendix III: State-level Data on FTHBC Claims: 

Table 6: State-level Claims for the FTHBC for 2008 and 2009 Compared 
with Census Population Data as of July 1, 2008, Sorted by Claims per 
Capita: 

Rank: 1; 
State: Nevada; 
Number of filers claiming FTHBC: 20,177; 
Population: 2,600,167; 
Claims per capita: 0.00776; 
Total dollars claimed: $146,370,293; 
Dollars per capita: $56. 

Rank: 2; 
State: Utah; 
Number of filers claiming FTHBC: 17,568; 
Population: 2,736,424; 
Claims per capita: 0.00642; 
Total dollars claimed: $129,687,371; 
Dollars per capita: $47. 

Rank: 3; 
State: Arizona; 
Number of filers claiming FTHBC: 38,130; 
Population: 6,500,180; 
Claims per capita: 0.00587; 
Total dollars claimed: $275,499,450; 
Dollars per capita: $42. 

Rank: 4; 
State: Florida; 
Number of filers claiming FTHBC: 105,865; 
Population: 18,328,340; 
Claims per capita: 0.00578; 
Total dollars claimed: $770,495,882; 
Dollars per capita: $42. 

Rank: 5; 
State: Tennessee; 
Number of filers claiming FTHBC: 35,836; 
Population: 6,214,888; 
Claims per capita: 0.00577; 
Total dollars claimed: $256,184,764; 
Dollars per capita: $41. 

Rank: 6; 
State: Georgia; 
Number of filers claiming FTHBC: 55,840; 
Population: 9,685,744; 
Claims per capita: 0.00577; 
Total dollars claimed: $398,493,119; 
Dollars per capita: $41. 

Rank: 7; 
State: Nebraska; 
Number of filers claiming FTHBC: 10,149; 
Population: 1,783,432; 
Claims per capita: 0.00569; 
Total dollars claimed: $70,893,504; 
Dollars per capita: $40. 

Rank: 8; 
State: Idaho; 
Number of filers claiming FTHBC: 8,525; 
Population: 1,523,816; 
Claims per capita: 0.00559; 
Total dollars claimed: $61,971,426; 
Dollars per capita: $41. 

Rank: 9; 
State: Minnesota; 
Number of filers claiming FTHBC: 28,780; 
Population: 5,220,393; 
Claims per capita: 0.00551; 
Total dollars claimed: $200,222,141; 
Dollars per capita: $38. 

Rank: 10; 
State: Michigan; 
Number of filers claiming FTHBC: 55,116; 
Population: 10,003,422; 
Claims per capita: 0.00551; 
Total dollars claimed: $362,430,212; 
Dollars per capita: $36. 

Rank: 11; 
State: Iowa; 
Number of filers claiming FTHBC: 16,532; 
Population: 3,002,555; 
Claims per capita: 0.00551; 
Total dollars claimed: $111,307,663; 
Dollars per capita: $37. 

Rank: 12; 
State: Colorado; 
Number of filers claiming FTHBC: 27,121; 
Population: 4,939,456; 
Claims per capita: 0.00549; 
Total dollars claimed: $193,220,686; 
Dollars per capita: $39. 

Rank: 13; 
State: Alabama; 
Number of filers claiming FTHBC: 25,303; 
Population: 4,661,900; 
Claims per capita: 0.00543; 
Total dollars claimed: $177,395,844; 
Dollars per capita: $38. 

Rank: 14; 
State: Texas; 
Number of filers claiming FTHBC: 131,472; 
Population: 24,326,974; 
Claims per capita: 0.00540; 
Total dollars claimed: $932,461,608; 
Dollars per capita: $38. 

Rank: 15; 
State: Oklahoma; 
Number of filers claiming FTHBC: 19,554; 
Population: 3,642,361; 
Claims per capita: 0.00537; 
Total dollars claimed: $133,377,012; 
Dollars per capita: $37. 

Rank: 16; 
State: Wyoming; 
Number of filers claiming FTHBC: 2,812; 
Population: 532,668; 
Claims per capita: 0.00528; 
Total dollars claimed: $19,719,986; 
Dollars per capita: $37. 

Rank: 17; 
State: Virginia; 
Number of filers claiming FTHBC: 40,597; 
Population: 7,769,089; 
Claims per capita: 0.00523; 
Total dollars claimed: $287,768,731; 
Dollars per capita: $37. 

Rank: 18; 
State: Mississippi; 
Number of filers claiming FTHBC: 15,142; 
Population: 2,938,618; 
Claims per capita: 0.00515; 
Total dollars claimed: $104,257,573; 
Dollars per capita: $35. 

Rank: 19; 
State: Arkansas; 
Number of filers claiming FTHBC: 14,670; 
Population: 2,855,390; 
Claims per capita: 0.00514; 
Total dollars claimed: $99,872,964; 
Dollars per capita: $35. 

Rank: 20; 
State: Missouri; 
Number of filers claiming FTHBC: 30,120; 
Population: 5,911,605; 
Claims per capita: 0.00510; 
Total dollars claimed: $207,974,834; 
Dollars per capita: $35. 

Rank: 21; 
State: Louisiana; 
Number of filers claiming FTHBC: 21,781; 
Population: 4,410,796; 
Claims per capita: 0.00494; 
Total dollars claimed: $150,314,448; 
Dollars per capita: $34. 

Rank: 22; 
State: Kansas; 
Number of filers claiming FTHBC: 13,836; 
Population: 2,802,134; 
Claims per capita: 0.00494; 
Total dollars claimed: $94,205,713; 
Dollars per capita: $34. 

Rank: 23; 
State: South Carolina; 
Number of filers claiming FTHBC: 21,876; 
Population: 4,479,800; 
Claims per capita: 0.00488; 
Total dollars claimed: $153,971,018; 
Dollars per capita: $34. 

Rank: 24; 
State: North Carolina; 
Number of filers claiming FTHBC: 44,785; 
Population: 9,222,414; 
Claims per capita: 0.00486; 
Total dollars claimed: $320,122,059; 
Dollars per capita: $35. 

Rank: 25; 
State: Indiana; 
Number of filers claiming FTHBC: 30,834; 
Population: 6,376,792; 
Claims per capita: 0.00484; 
Total dollars claimed: $209,073,724; 
Dollars per capita: $33. 

Rank: 26; 
State: Alaska; 
Number of filers claiming FTHBC: 3,153; 
Population: 686,293; 
Claims per capita: 0.00459; 
Total dollars claimed: $21,767,374; 
Dollars per capita: $32. 

Rank: 27; 
State: Kentucky; 
Number of filers claiming FTHBC: 19,230; 
Population: 4,269,245; 
Claims per capita: 0.00450; 
Total dollars claimed: $132,955,896; 
Dollars per capita: $31. 

Rank: 28; 
State: Delaware; 
Number of filers claiming FTHBC: 3,886; 
Population: 873,092; 
Claims per capita: 0.00445; 
Total dollars claimed: $27,412,020; 
Dollars per capita: $31. 

Rank: 29; 
State: Montana; 
Number of filers claiming FTHBC: 4,272; 
Population: 967,440; 
Claims per capita: 0.00442; 
Total dollars claimed: $29,631,226; 
Dollars per capita: $31. 

Rank: 30; 
State: Wisconsin; 
Number of filers claiming FTHBC: 24,685; 
Population: 5,627,967; 
Claims per capita: 0.00439; 
Total dollars claimed: $171,136,305; 
Dollars per capita: $30. 

Rank: 31; 
State: California; 
Number of filers claiming FTHBC: 160,785; 
Population: 36,756,666; 
Claims per capita: 0.00437; 
Total dollars claimed: $1,151,605,634; 
Dollars per capita: $31. 

Rank: 32; 
State: Pennsylvania; 
Number of filers claiming FTHBC: 53,521; 
Population: 12,448,279; 
Claims per capita: 0.00430; 
Total dollars claimed: $366,475,016; 
Dollars per capita: $29. 

Rank: 33; 
State: Ohio; 
Number of filers claiming FTHBC: 48,776; 
Population: 11,485,910; 
Claims per capita: 0.00425; 
Total dollars claimed: $326,460,385; 
Dollars per capita: $28. 

Rank: 34; 
State: Maryland; 
Number of filers claiming FTHBC: 23,831; 
Population: 5,633,597; 
Claims per capita: 0.00423; 
Total dollars claimed: $166,204,408; 
Dollars per capita: $30. 

Rank: 35; 
State: North Dakota; 
Number of filers claiming FTHBC: 2,699; 
Population: 641,481; 
Claims per capita: 0.00421; 
Total dollars claimed: $18,139,186; 
Dollars per capita: $28. 

Rank: 36; 
State: South Dakota; 
Number of filers claiming FTHBC: 3,343; 
Population: 804,194; 
Claims per capita: 0.00416; 
Total dollars claimed: $22,630,645; 
Dollars per capita: $28. 

Rank: 37; 
State: Washington; 
Number of filers claiming FTHBC: 26,604; 
Population: 6,549,224; 
Claims per capita: 0.00406; 
Total dollars claimed: $189,408,939; 
Dollars per capita: $29. 

Rank: 38; 
State: Illinois; 
Number of filers claiming FTHBC: 51,794; 
Population: 12,901,563; 
Claims per capita: 0.00401; 
Total dollars claimed: $357,438,259; 
Dollars per capita: $28. 

Rank: 39; 
State: Rhode Island; 
Number of filers claiming FTHBC: 4,190; 
Population: 1,050,788; 
Claims per capita: 0.00399; 
Total dollars claimed: $29,762,911; 
Dollars per capita: $28. 

Rank: 40; 
State: New Hampshire; 
Number of filers claiming FTHBC: 5,145; 
Population: 1,315,809; 
Claims per capita: 0.00391; 
Total dollars claimed: $35,402,421; 
Dollars per capita: $27. 

Rank: 41; 
State: Massachusetts; 
Number of filers claiming FTHBC: 25,090; 
Population: 6,497,967; 
Claims per capita: 0.00386; 
Total dollars claimed: $172,308,588; 
Dollars per capita: $27. 

Rank: 42; 
State: Maine; 
Number of filers claiming FTHBC: 5,080; 
Population: 1,316,456; 
Claims per capita: 0.00386; 
Total dollars claimed: $34,907,560; 
Dollars per capita: $27. 

Rank: 43; 
State: Oregon; 
Number of filers claiming FTHBC: 14,248; 
Population: 3,790,060; 
Claims per capita: 0.00376; 
Total dollars claimed: $101,012,536; 
Dollars per capita: $27. 

Rank: 44; 
State: New Mexico; 
Number of filers claiming FTHBC: 7,262; 
Population: 1,984,356; 
Claims per capita: 0.00366; 
Total dollars claimed: $51,382,080; 
Dollars per capita: $26. 

Rank: 45; 
State: New Jersey; 
Number of filers claiming FTHBC: 30,471; 
Population: 8,682,661; 
Claims per capita: 0.00351; 
Total dollars claimed: $209,133,493; 
Dollars per capita: $24. 

Rank: 46; 
State: Connecticut; 
Number of filers claiming FTHBC: 12,223; 
Population: 3,501,252; 
Claims per capita: 0.00349; 
Total dollars claimed: $84,964,985; 
Dollars per capita: $24. 

Rank: 47; 
State: Vermont; 
Number of filers claiming FTHBC: 2,100; 
Population: 621,270; 
Claims per capita: 0.00338; 
Total dollars claimed: $14,183,146; 
Dollars per capita: $23. 

Rank: 48; 
State: West Virginia; 
Number of filers claiming FTHBC: 5,536; 
Population: 1,814,468; 
Claims per capita: 0.00305; 
Total dollars claimed: $36,203,272; 
Dollars per capita: $20. 

Rank: 49; 
State: New York; 
Number of filers claiming FTHBC: 50,673; 
Population: 19,490,297; 
Claims per capita: 0.00260; 
Total dollars claimed: $341,384,040; 
Dollars per capita: $18. 

Rank: 50; 
State: Hawaii; 
Number of filers claiming FTHBC: 3,207; 
Population: 1,288,198; 
Claims per capita: 0.00249; 
Total dollars claimed: $22,391,318; 
Dollars per capita: $17. 

Rank: 51; 
State: District of Columbia; 
Number of filers claiming FTHBC: 1,383; 
Population: 591,833; 
Claims per capita: 0.00234; 
Total dollars claimed: $9,480,535; 
Dollars per capita: $16. 

Source: GAO analysis of IRS and Census data. 

Note: FTHBC data are for 2008 and 2009 claims as of August 22, 2009. 

[End of table] 

[End of section] 

Footnotes: 

[1] Pub. L. No. 110-289, 122 Stat. 2654 (2008) and Pub. L. No. 111-5, 
123 Stat. 115 (2009). The 2008 FTHBC applies to purchases made between 
April 9, 2008 and June 30, 2009. The 2008 FTHBC was amended by the 2009 
credit, which applies to purchases made between January 1, 2009 and 
November 30, 2009. 

[2] IRS made minimal computer programming changes directly pertaining 
to the 2009 FTHBC. Officials said changes were implemented as part of 
Recovery Act programming changes, which resulted in IRS having to shut 
down its computers one weekend during the middle of the filing season-
-a first for IRS in several officials' memories. 

[3] One potential example of supplemental documentation would be a copy 
of the Housing and Urban Development (HUD) form, HUD 1, Settlement 
Statement, required to be provided by settlement agents to the borrower 
at the time of closing. The form provides the date and sale price, 
which could help determine eligibility for the credit. However, it does 
not include a Social Security number, which makes matching to tax 
returns a challenge and it would be burdensome for closing agents to 
provide to IRS. 

[4] The 2009 tax credit has a recapture provision. If a house is resold 
within 3 years, the credit must be repaid, under certain conditions. 

[5] GAO, Tax Administration: Opportunities Exist for IRS to Enhance 
Taxpayer Service and Enforcement for the 2010 Filing Season, 
[hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-09-1026] (Washington, 
D.C.: Sept. 23, 2009).

[End of section] 

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