Date: Teves 5559
From: Rabbi Moshe Sofer
To: Mattersdorf
A community inflated its flood damage claims to the government, which ultimately offset the compensation against the community's tax debt. The Chasam Sofer ruled that actual damages owed to individuals must first be restored to them, that expenses are deducted from the total, and that the remaining profit from the inflated claims is divided equally among all permanent residents — including non-taxpayers — since all share equally in communal property such as the synagogue and Torah scrolls.
Source: Shu"t Chasam Sofer CM §123