This illegal practice, known as Homestead Exemption fraud, has garnered the attention of authorities, prompting decisive action.
New Orleans is grappling with a unique problem related to property taxes, as the names of deceased individuals continue to appear on property tax rolls, enabling their loved ones to fraudulent benefit from tax breaks
In 2016, Governor John Bel Edwards signed a law criminalizing this activity, imposing a minimum penalty of six months in jail and a $500 fine. Homestead Exemption fraud occurs when individuals knowingly exploit tax exemptions or age freezes intended for older citizens, wrongfully obtaining property tax breaks that are not rightfully theirs.
Typically, the issue arises when a person passes away, and a relative or loved one continues to reside in the deceased’s home without properly transferring the title, thereby evading higher taxes. An investigation conducted by New Orleans Inspector General Ed Michel in 2021 unveiled 18 residential properties where deceased individuals were still benefiting from tax breaks.
Subsequent complaints suggest that currently, more than 300 deceased individuals are fraudulently receiving property tax breaks
Inspector General Michel emphasized the crucial role of immediate notification to the assessor’s office when inheriting a house from a deceased relative. It falls upon the inheritor to inform the office about the deceased person’s tax exemption or freeze, facilitating a reassessment of the property. Failure to do so not only violates the law but also burdens the city financially, potentially resulting in the loss of hundreds of thousands or even millions of dollars.
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