(Newser)
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Thousands of US companies that raked in federal stimulus money are tax cheats who owe the government millions. At least 3,700 government contractors and nonprofit organizations that received more than $24 billion in stimulus funds owed $757 million in back taxes while they were collecting their booty, according to a new report by the Government Accountability Office. One security firm collected $100,000 in stimulus funds while owing some $9 million in unpaid taxes, reports AP. A nonprofit collected $1 million, while owing $2 million. Under law, tax cheats are not barred from getting government contracts or grants. But pressure is mounting on businesses to pay up.
"It is a matter of basic fairness that those who take government money should be required to pay their taxes like everyone else," said Oklahoma Republican Sen. Tom Coburn, a member of the Homeland Security and Governmental Affairs subcommittee that's holding a hearing on the report today. "That such a huge amount of the stimulus money went to known tax cheats should be a wakeup call for Congress." The 2009 stimulus package doled out some $821 billion to boost the economy, with $275 billion set aside for contracts and grants. Some 15 tax cheat cases uncovered by the GAO have been referred to the IRS for further investigation.
