Case: U.S. Court Orders Repayment of Erroneous Tax Refund After Fraudulent Filing

The U.S. Court of Federal Claims held that the taxpayers were liable for repayment of an erroneously issued tax refund, granting summary judgment to the IRS. Taxpayers, a married couple, filed a 2020 tax return reporting vastly inflated income and withholding amounts based on fraudulent W-2 forms they created. The IRS issued a refund based on false information. The government filed a counterclaim to recover the erroneous refund. The court held that no genuine dispute of material fact existed regarding the erroneous nature of the refund. The taxpayers’ arguments that they did not intend to defraud the government and that ...