W-2 with $1 million withholding drives IRS mad
This week we return to Florida (yes, we were just there last month) to the story of Tampa resident Ramon Blanchett, who received a refund of $980,000 after filing his taxes in 2017. The problem? His reported income was only $18,497.1
The self-described freelancer had two W-2s during the tax year, one from a nursing home and the other from a restaurant. One of the forms incorrectly listed his withholding as $1 million, which led to the refund check from the IRS.
The bank where Blanchett deposited the money suspected fraud and eventually closed his accounts. He went to a credit union next, depositing the money into multiple accounts while "falsely representing that the funds were from the estate of his deceased father," according to a federal complaint.
Everyone grieves differently, apparently, and Blanchett went out and bought a 2016 Lexus RC350 for $49,117.
Blanchett has not been charged with a federal crime, but a seizure warrant allowed the IRS to take the car and the more than $900,000 that was left in his accounts. And the IRS is now going after the $809 refund Progressive Insurance sent to Blanchett because he no longer has the car. So much for driving off into the sunset.