Back in the darkest days of the Great Recession, Congress passed a law that gave first-time home buyers a credit of $7,500 on their income taxes to rekindle real-estate sales.
Miami tax preparer Noe Mompoint filed returns for a couple of hundred new South Florida home purchasers claiming the credits — and got into serious trouble with the Internal Revenue Service.
But late Monday, the 49-year-old Southwest Ranches resident survived the scare of his life when a Miami federal jury acquitted him of charges alleging that he assisted in the filing of 11 false returns, the most suspicious of the bunch.
His attorney, David Garvin, who has won tax-evasion acquittals for Indy 500 racing champion Helio Castroneves and former Hialeah Mayor Julio Robaina, prevailed with the simple argument that Mompoint made an “honest mistake” and “did not intentionally” break the law enacted in July 2008.
Justice Department prosecutors, who have been making similar cases around the country while arguing that such false claims cost the U.S. government about $75 million, filed an indictment against Mompoint last year. They accused him of preparing “false” returns for tax year 2008, alleging that at least 11 of his clients did not qualify because they had bought their first homes before the qualifying period of April 2008 through December 2009.
Garvin argued, in court filings and at trial over the past week, that “the retroactive starting date and the ending date in 2009 led to a great deal of confusion,” not only for Mompoint’s clients but also for the tax preparer himself.
As a result, he filed returns claiming the First-Time Home Buyer Credit for his clients, though they had actually purchased their homes before the qualifying period.
“Mr. Mompoint was one of many taxpayers and/or preparers that was confused,” Garvin said in a court filing. “This confusion was widespread and led to many tax returns incorrectly claiming the [credit].”
Prosecutors Charles Edgar and Jason Poole claimed that Mompoint, who charged each of his clients an extra $600 for the credit claims, did not make a “simple mistake” and that his actions were “intentional.”
For the dozen federal jurors, their verdict mainly boiled down to the “reasonableness of the mistake” made by Mompoint, who was potentially facing up to three years in prison on each of the 11 charges. Apparently, jurors gave more weight to his “mistaken understanding” as to who qualified for the tax credit under the law, according to Garvin.
The legislation, which had been promoted by the Obama administration to stimulate home sales, came with strings attached. While first-time home buyers were allowed to take the tax credit for 2008, it was actually a loan that had to be repaid in increments of $500 a year.
Garvin said that of Mompoint’s 11 clients cited in the indictment, almost all have paid back or are repaying the $7,500 credit.