The Washington Times

12/07/03

METROPOLITAN SECTION

Tax filers taking war hero benefits

    RICHMOND (AP) — State officials are trying to determine whether

hundreds of Virginians erred — or lied — when claiming a state tax deduction

intended for Medal of Honor recipients.

    Only four men alive today in Virginia received the Medal of Honor,

which is the nation's highest military honor, awarded for risk of life   in

combat beyond the call   of duty. But 642 persons claimed the state tax

deduction when it was offered for the first time in 2001. It is a federal

crime to impersonate a Medal of Honor recipient.

    The state told the Norfolk Virginian-Pilot it will track down the

taxpayers and require those who made incorrect claims to pay their   debts

plus penalties. However, tax department officials acknowledged it   would be

difficult to prosecute anyone for fraud because it is too hard   to prove

the intent to deceive.

    "I can't fathom why people would do things like that," said Marine Corps

Lt. Col. Howard V. Lee of Virginia Beach, who was awarded the Medal of Honor

in a 1967 White House ceremony.

    The Marine officer helped rescue a reconnaissance unit in Vietnam even

though he had been temporarily blinded in one eye by fragments from an enemy

hand grenade.

    Col. Lee said he was more surprised than angry at the number of people

claiming the tax deduction. "I'll give them the benefit of the

doubt that it was a mistake," he said. There are only 132 living recipients

of the Medal of Honor.

    In 2000, the General Assembly passed a law allowing medal   recipients

to deduct their military pensions when they tabulate their

state taxes. State Sen. John S. Edwards, Roanoke Democrat, introduced the

legislation after learning that similar tax deductions are offered in

other states.

    Janie E. Bowen, executive commissioner for policy and administration at

the state tax department, said $1.6 million in income was exempted from

taxes due to the deduction in 2001, the most recent data available. She said

tax officials have not yet calculated the amount of revenue lost by false

claims. Based on the average state income tax rate of 4.5 percent, the loss

could be about $70,000.

    Miss Bowen said analysts are examining the returns to determine whether

filers used the wrong two-digit identification numbers to claim their

deduction.

    The code number for the Medal of Honor deduction is 44. Other deductions

with identification numbers in the low 40s include one for assets returned

to Holocaust victims, one for tobacco farmers, one for landowners who

dedicate property for open space and one for donations to a public school

construction program.

    Not everyone is ready to believe that the tax filers made innocent

errors.

    Randy Lee Everette of Virginia Beach operated a Web site exposing people

who falsely claimed to be Medal of Honor recipients until he

became overwhelmed with reports of fraud and had to give up the project. He

said the list of names on his site grew to about 130.