ORANGE COUNTY, Fla. – Homestead exemption "cheats" may be costing Orange County taxpayers a stunning $1 billion, according to county property appraiser Rick Singh.
[WEB EXTRA: Report homestead exemption cheats]
In the last 18 months, Singh estimates his office has returned just under $70 million in tax-break revenue caught in fraudulent claims spanning the last 10 years.
"It's still going on," Singh said. "I think this is just the tip of the iceberg."
Singh has recruited three investigators with law enforcement backgrounds to sift through fraud hotline tips phoned in by residents.
Local 6 rode with a former Seminole County Sheriff's deputy recently hired to investigate alleged homestead fraud in Orange County.
The investigator, who asked to not use his name, has seen a common trend of rental properties being used in a sort of homestead shell game.
The homeowner-turned-landlord continues to list the property as the "permanent residence," which under Florida law is eligible for a $25,000 tax exemption.
A homeowner may also be eligible for a second exemption of up to $25,000, depending on the value of the home.
But according to the county investigator, the owners are "double-dipping" -- filing exemption status for a rental property and for a second home in Florida or another state.
In one case, Local 6 found a woman living in Jacksonville still getting a homestead exemption for a property she is renting to a friend in Orlando.
The homestead deception problem plays across Central Florida.
In 2010, Lake County's property appraiser's office reported in excess of $10 million in illegal homestead tax breaks that were eventually denied or cancelled because of tips from area residents.
In Seminole County we found a much different story. The county's system catches homestead issues when owners don't respond.
This year, 2,000 denials have been sent out. In years past an estimated 20 percent or the forms are returned; the rest lose the exemption.
Still, there are cases that might slip through the system.