Investigating Homestead Fraud: Why it Matters

September 6, 2013

homestead fraudEvery year, states lose millions of dollars in potential tax revenue due to fraudulently filed homestead exemptions. These range from exemptions claimed on multiple homes, on a property in which the filer is not the primary resident (i.e. rental properties), or on a home in which the primary resident is deceased. According to a 2012 Audit by New York State Comptroller, Thomas DiNapoli, New York lost $13 million due to homestead exemption fraud from 2011-2012 alone. And DiNapoli has predicted that the state will lose another $73 million in revenue by 2016 if steps are not taken to fight the growing problem. Think about that number: $73 million dollars. How would a loss like that affect your state? County and city budgets would have to be cut, school districts would suffer, and the overall quality of life would go down.

Now think about your state’s current revenue and budgets. What if you could increase these numbers by identifying homestead fraud and collecting the back taxes that are owed to your state?

Here are a few tips your state can use to effectively identify and investigate homestead fraud:

  • Set up a hotline on your county property appraiser’s website where citizens can anonymously report suspected homestead fraud
  • Partner with local municipalities to identify vacant land and rental properties and check to see if homestead exemptions have been filed for these locations
  • Work with state legislators to strengthen homestead exemption laws and to increase the penalties for violations
  • Miller Starr Banner 1Create a unit within your county appraiser’s office that is dedicated to investigating homestead fraud
  • Search utility records, real property records, social security numbers, addresses, and death records, to identify misfiled and duplicate homestead exemptions

These measures may seem expensive and time consuming, but if you consider the millions of dollars in tax revenue that could be recovered, you will find that the benefits far outweigh the costs.

Learn How CLEAR Can Help You Investigate Homestead Fraud and Increase Your State’s Revenue

CLEAR is an investigative tool that combines the most comprehensive collection of public and proprietary records with key analytics to give you a more complete picture of the homeowner you are investigating. For more information, visit