You'll need to sign a contract no later than _______ and close no later than _______ .

It's a maximum of $8,000 for first-timers and $6,500 for repeat buyers. You get 10 percent of your purchase price up to that amount.

Didn't we just finish doing this?
Did it help anything?

Well, judging by the volume of questions I'm getting, a lot of people are hoping to get the money. Whether they would have bought anyway is another matter.

In my market, Olympia Washington, the tax credit just doesn't seem to be "stimulating" that many people to purchase. As broker and owner of a real estate company, it's disappointing.

Here's a wrinkle for you. Am I a repeat buyer if I lived in my home from 2003 to 2008, got divorced in 2008 and deeded the house to my wife at that time? Now I'm single and want to buy a place. Do I qualify?

Alex, if you owned for five FULL years (rather than four years and change), then you should qualify.

The key is five consecutive years of ownership (and residence) during the eight-year period ending when you purchase a new primary residence. The IRS doesn't care whether you got rid of your old place a few years earlier, are keeping it as a second home, will be renting it out or plan to sell it, as long as your new place will be your primary digs.

Jamie, thank you so much for all the hard work you're doing to answer these many questions. I'm just following up with you to find out if you had heard anything from the IRS regarding my post from a few weeks back:

"I was divorced in January of 2009. I owned a home with my ex for more than five years within the last 8 years (May 2003-January 2009). He kept the house. Now we are each looking to buy (he's selling the old house, I'm currently renting). Does each of us qualify for the $6500 tax credit if we each are able to close before April 30?"

Posted by: Azure | February 5, 2010 11:20 AM

"Azure, I'm not certain on that one. It seems like you probably would each qualify because you're divorced, not simply separated. But I haven't seen the IRS address that specifically.

...I just sent your question...to an IRS spokesman to see if he has answers."

I've scoured the IRS website and other sources for a solid answer, to no avail.

Azure, thanks for the reminder -- I asked your question again and got a speedy answer this time: As long as they qualify on all counts, divorced couples can both get the $6,500 credit when they buy again. So it sounds like you're in luck.

My husband has lived in his house for five years, married for three, he is the only one on the mortgage and house. Do we qualify for the $6,500? Thank you!
Kelli

Sorry, Kelli -- married couples must both meet the five-year requirement. Take another look at my post and you'll see I covered that.

Has anyone heard of a new credit if you buy in Baltimore City besides the one discussed above?

Hi, Megan -- perhaps you mean the city's down payment and closing cost assistance? It's not exactly new, but it recently got new funding. More details here: http://www.baltimorehousing.org/news.asp

My wife and I lived in the same house for 9 years and sold in Dec 2008. We hated the neighborhood and sold again in Feb. 2010 at which time we bought another new residence. Are we eligible for the $6500 credit? Thanks, Jeff

Hi, Jeff -- I was going to say no, but on second thought I'm not certain. You owned a home for at least five consecutive years of the last eight, and you bought a new place in a qualifying month. The potential sticking point is this: By owning another primary residence between the two, does that disqualify you?

I just don't know, sorry. This is a question for a tax expert.

I purchased my house 7 years ago when I was single. I got married and my husband has now lived there for 5 years but his name is not on the house or the mortgage. I know both people have to have lived there five years, we have. But the thing that concerns me is his name is not on the mortgage, so will they not count him as owning it. I am thinking since we are married whats mine is his.

Brooke, if you've been married for at least five years, you should be fine. The IRS has said that marriages "imputes" ownership to the other spouse -- a fancy way of saying "what's mine is his." (I'm no tax expert, though. Just keep that in mind.)

Thanks for your answer, this brought up another question. I have owned and lived in the house for 7 years but we haven't been married a full five years- will be five on july 17th, however he moved in before we got married and has lived there five years. We are going to close on a house April 28th. Would the five years be calendar years 2005-2010 or does it have to be a actuall five years in his case. Im just wondering if they will actually check the exact date we were married or just that we filled married on our taxes for 2005, which would make 2010 five years. Thanks

Brooke, tax experts say the IRS is a stickler for the full five years. But you'll probably want to consult with a tax professional about your situation just in case his residence there before your marriage makes a difference.

My aunt and uncle are not married. They both have lived together in California for more than 19 years in the home they bought together. My aunt and uncle bought the home they live in 1991. They have held the property as tenants in common. They both had trusts draw up uncle in 2003, aunt in 2006 and the home was put in their separate trusts. In the trust it specifies the home will pass to the other in the event of one of their deaths . The questions is they now are in the process of selling their home and are buying a home in another county and town, but still in the state of CA. My aunt owes no taxes and hasn't paid taxes or filed a tax return for years. My uncle owes taxes for 2009. Are they both eligible for the $6500 repeat buyer Obama tax credit because they are seperate individuals on the purchase of their new home which will be their primary residence. Does my aunt qualify for the credit? Is she an eligible tax payer? Should they put the new home only in my uncles name and add my aunt later? Is that legal.? Or do they need to leave her name off/on for any reason. My uncle, like anyone, wants to receive the full tax benefit. What he will owe on taxes for 09, this credit will cover almost all the tax he owes. Their respective trusts state that if one (aunt or uncle) passes the other receives everything from that persons trust which will include the house. The sale of their home and pruchase of their new home should happen next week , March 29 and 30th. If it is possible can you answer as soon as it is possible.

Thank you Nancy Howard (the niece)

Nancy, if I'm following this correctly, most of these details don't have any bearing on the situation. They've both owned the house for more than five years. They're both buying a new place. As long as they're not high-income individuals, it sounds like they qualify.

This IRS publication -- http://www.irs.gov/pub/irs-drop/n-09-12.pdf -- details how unmarried people can split the tax credit. As it points out, unmarried buyers can allocate the money between them based on their contributions to the purchase price, their share of the home or any other reasonable way -- including all the credit to just one of the parties.

So your uncle could take the entirety of the credit, if your aunt has no objection. (They just can't each get $6,500.)

I still don't get people who don't see the "big picture"..Why would someone "buy" something at still bubble prices so they can "get" $8,000? $8,000 doesn't even cover closing costs. Wake up people...

How does the real estate industry/profession keep a straight face when trying to lure in buyers?

my brother is looking to upgrade to a new home. he meets the time and income qualifications. his wife's parents are planning to buy their home to help get them out from under it, and they wanted to make sure that they still qualify for the $6500 tax credit.would
thanks

Kaite, I'm no tax expert, but I don't recall hearing that the IRS cares who the credit applicants sell their original residence to -- you don't even have to sell to qualify for the $6,500. (Now, you can't buy a place from a close relative and qualify for the credit, but that's a different matter.)

My grandmother passed away and my aunt inherited her house upon her death. I am a first time home buyer and my aunt is now selling the house to me, do I qualify for the tax credit?

Hi, I lived and owned my first home from 06/2002-09/2008, when I sold it. I then purchased my second home on 06/2009. Would I be eligible for the repeat buyer credit? If so, is it possible to amend my return to receive it?
Thanks.

Megan, the IRS says you can't buy from "a close relative," including "your spouse, parent, grandparent, child or grandchild." I haven't seen a more specific list, so I'm not sure whether an aunt is an IRS-defined close relative, sorry.

MM, the repeat buyer credit didn't exist when you bought your home, so no, you don't qualify. It didn't kick in until Nov. 7.

Can you just choose to get mail at the new home as long as you stay in the new home most of the time. Isn't this an easy way around the rule. I have lived here more than 10 years and purchasing another home on a lake and plan to stay there most of the time, can I qualify. I need to say that I would occupy my current home some of the time.
Any Suggestions
Thanks
Roy

Roy, the Realty Times did a piece about primary residences and says the definition is a bit fuzzy. But, it notes, "If the homeowner has two houses, and uses each as a residence for successive periods of time ..., the property that the homeowner uses a majority of the time during the year will usually be considered the principal residence." (http://realtytimes.com/rtpages/20010129_residence.htm)

So if you're planning on using the new home most of the time, you probably do qualify for the $6,500 repeat-buyer credit. (The IRS does not require you to sell your previous home, just that you no longer use it as your primary residence.)

We qualify for the $6500 by owning a house for 5 yrs. Now we've sold and are building another house on land we have owned for 2 yrs. We are under contract and will be closing before July 1, but do we have to have a CO by April 30?

Rachel, the key is to occupy your new place by June 30.

What if I buy a house by the deadlines, but later decide to raze most of the house and rebuild the greater part of the house (an extensive remodeling)?

What if you meet the deadlines, but the new house has to undergo such extensive remodeling that you cannot move into it for months? By extensive remodeling, I mean actually tearing down part of it.

Well, lloyd, the IRS had this to say in response to a question about renovation: "Taxpayers who purchase an existing home and renovate the property before moving in are eligible for the first-time homebuyer credit based on the date of purchase, not the date of occupancy."

So that sounds like you would be eligible. But I can't say whether the IRS has a different opinion if the renovation includes partial tear-down and/or if the work drags on into next year. That's a question for an expert.

Thank you for providing these answers.

Will the loan assumption process provide a HUD-1 Form?

Assuming the loan from a deceased relative's estate fall under buying from a relative or would the sale actually be from the mortgage company to me?

I have a question with a small twist.

I am newly married. My husband owned his house for 9 years. I owned my house for 5 1/2 years. We sold both houses in 2009.

We purchased a new house in December of 2009.

Would we qualify since we both owned our primary residences for more than 5 years?

Believe it or not, Katherine, the answer is no. According to the IRS, "Both spouses must have owned and used the same previous principal residence for five consecutive years out of the 8-year period ending on the date of purchase of the new principal residence to qualify for the credit." (Emphasis mine.)

I’m moving from NY to NH for grad school this summer. I’m planning on buying a condo in NH (first time home buyer). I’m already in contract and have started the loan application process. My graduate stipend (salary) will be less than one-half of what I make now, so I wasn’t pre-approved for enough to purchase the place using my NH salary. The mortgage broker recommended purchasing the home as a “secondary residence” using my current salary. I will be using the condo in NH as my primary residency though, so will I qualify for the tax credit or will the IRS look at my mortgage documents?

My husband and I moved into our home in Dec. 2004 doing a lease purchase until we could sell our previous home. We lived in the home until Dec. 2009 and sold it April 2010. Would we qualify for the 6500 tax credit since the 1st year of the five was a lease purchase?

Alyssa, here's what the IRS says about principal residences: "For taxpayers with multiple homes, the regulations list several factors relevant to determining which home is the principal residence. Among these are amount of time used; place of employment; where other family members live; the address used for tax returns, driver’s license, car and voter registration, bills and correspondence; and the location of the taxpayer’s banks, religious organizations or recreational clubs."

Just remember: "If, within 36 months of the date of purchase, the property is no longer used as your principal residence, you are required to repay the credit."

You're sure you can actually afford this place, right? Just checking. You don't want to regret the purchase later.

Sherry, I don't know the answer to your question. I suspect the IRS wouldn't count your ownership until the day you closed on the actual sale, but you'll want a tax professional's opinion on this one.

What documentation does the IRS ask for regarding your ownership history? For instance, I owned a condo all through college that I lived in and rented out the extra rooms. I moved out of the condo in May of 2007 and have been renting it out since that time. I am currently set to close on a new condo on May 28th. My tax returns for 2007, 2008 and 2009 all list a different address than the rental condo, but I don't know how I would prove that I moved out in May of 2007 (which is almost exactly 3 years).

Corey, here's what the IRS says about documentation:

---

You can avoid refund delays by attaching documentation, such as the following, covering the five-consecutive-year period:

* Forms 1098, Mortgage Interest Statement, or substitute mortgage interest statements,
* Property tax records, or
* Homeowner’s insurance records.

It is not necessary to have five years of the same documentation. Any combination of these documents that help verify that you owned and lived in your home as a principal residence for at least five consecutive years is acceptable. For example, suppose you owned and lived in your previous home from Nov. 1, 2003, to Oct. 31, 2008. You could send a copy of Form 1098 showing the mortgage interest you paid for the part of 2003 during which you owned and lived in the home, as well as 1098s for 2004, 2005 and 2006, a copy of homeowners insurance records for 2007 and a property tax statement for the part of 2008 during which you owned and lived in the home.

I sold my house that I had been living in for 7 years in mid December. My parents purchased a house in late October because it was a great deal, knowing that I would purchase it from them once my house sold. They never used it as thier primary residence or rented it out. Would this qualify for the $6500?

I have a question that has not been asked. I have owned and lived in my property since 2003. My husband has lived in this property with me since the purchase date in 2003 but his name is not on the title (I'm the sole owner but both of our tax returns since 2003 have reflected this property as our home address).
Also, we got married in 2006 and since then have filed jointly.
We are purchasing a house where both of our names will be on the title (will be meeting the 4/30 and 6/30 timelines). Do we quality for the Repeat Home Buyers Tax Credit?

Lisa, I'm afraid that a buyer can't qualify for the credit if she or he is buying from a close relative such as a parent. (See here: http://www.irs.gov/newsroom/article/0,,id=206291,00.html) You could consult a tax expert to see if your situation gives you any wiggle room, but the IRS doesn't strike me as the sort of agency to grant exceptions.

Cris, here's what the IRS has said about the repeat credit: "Both spouses must have owned and used the same previous principal residence for five consecutive years out of the 8-year period ending on the date of purchase of the new principal residence to qualify for the credit." (Emphasis mine) So it seems that living in the home is not enough. Here's the link: http://www.irs.gov/newsroom/article/0,,id=206293,00.html

If you are in a contract with a property but it is a continuency of third party because it is a short sale do you qualify if you can close by june 30th

We started a contract - signed by the buyer and the seller back in January...this short sale process has taken FOREVER. Now it is 4/28/2010 and there is only 48 hours left for us to get the 8K credit. We have submitted our final offer to the bank a few days ago and are awaiting approval.

My question is - do we meet the requirements of being "under contract" before the 30th of April because the buyer and seller have signed a contract. Does that mean we have a contract started before the 30th???

No one seems to be able to provide a straight answer to me, and it seems that wherever I look, different people have different answers. I am looking for a 100% answer to this question. Some sources say we are "under contract" because the buyer and seller have signed...while others say the lender needs to sign as the 3rd party and an escrow needs to be started for it to be recognized as "under contract" and eligible for the 8K.

CAN ANYONE ANSWER THE QUESTION WITH 100% ACCURACY???

2 questions:
I was divorced in Jan 2010. My wife stayed in the house and refinanced in her name only. We purchased the house in May 2008. Previously, we were in a house since Sept 2001. Do I qualify under these circumstances?
2) Does a backup contract count as a binding offer and qualify for the credit if accepted by 4/30? even if it becomes the primary contract after 4/30? and it is closed before June 30?

Anthony, I wish I could offer advice, but I wasn't able to find a definitive answer between deadlines. It's a legal question -- does a short sale contract count as a binding contract even before the bank weighs in? You'll want an attorney's viewpoint, I think.

Russ, you don't qualify for the $6,500 repeat buyer credit because your most recent home wasn't yours for at least five years of the past eight. (It has to have been the most recent, not the previous or some combination thereof.)

As for question #2, I talked to an agent recently who speculated that a signed backup contract would count as a binding offer under the circumstances you describe. But like Anthony's question above, this is really a legal matter and you'd probably want to consult with an attorney.

My husband bought our house on a land contract 8 years ago. His two aunts and his father now hold the title and the contract but wish to be bought out, so he is going through the process of purchasing the home through the bank. Would he qualify for either credit? We have a purchase agreement as of the 28th. Does the fact that his dad own's 33% of the home count against us?

Kelly, I don't know, but I suspect that even a 33 percent ownership by a close relative is too much for the IRS. That's a question for a tax expert. (You'd also want to ask whether the land contract issue is a problem.)

My boyfriend (co-owner) GOT the credit. we spend it already on a refi (within 90 days of original home purchase in June).

he's leaving. so its not his primary. but its still mine. he has to pay back, right? so do i claim it now, get the money, then pay him off? what do I do? again, we GOT the credit. he did. now he wants ME to pay him /figure out the 8k bill he'll be stuck with. thoughts?

We put in a bid on a short sale n it was accepted by the owner but not the bank yet n its may do we still qualify for the tax credit?

Jordynn28, I don't know. I forwarded your question to the IRS, though there's no guarantee of an answer since it's such a specific situation. Let's assume he does have to pay it back (that's what I'd figure, anyway): It really comes down to whether it's fairest for him to take the full hit, half the hit or none of the hit. I'm guessing his argument is that you'll continue to get the benefit of the credit through your lower mortgage payment.

Jeana, I don't know the answer to that question, either. I've asked the IRS, but it might come down to state law on whether a short sale contract that is not yet approved by a bank is a binding deal.

We purchased our townhouse 4/25/2002 and sold it 12/21/09. We have lived there since 2002. We bought a new house 4/8/10. Do we qualify for the $6500 tax credit . Thanks

You meet the timeline test. There's also an income cap, but if you've checked that out and don't make more than the limit, you should be good.

Scenario: Husband and wife owned and occupied a home for over 5 years. They were legally separated in Dec. 2009. Wife purchased and closed on condo on April 29th 2010. Condo is in wife's name and also her parents name.The condo is paid for and wife is making mortgage payments to her parents. The Hud statement also has wife and her parent's name on it. Is she entitled to
$6500 credit. Thank you for any help.

aslove, here's an IRS Q&A about a similar situation:

---

Q. Taxpayer A is a single first-time home buyer. Taxpayer B (parent) cosigns for A and does not qualify. Both names are on the mortgage. Can Taxpayer A claim the credit and, if so, how much?

A. Yes. Taxpayer B is not a first-time homebuyer and cannot claim any portion of the credit, but A may claim the entire credit ($7,500 for purchase in 2008; $8,000 for purchase in 2009), if the home was purchased as Taxpayer A's primary residence.

--

Me again: Whether your financing situation complicates things, I don't know. One of those "tax expert" questions, I'm afraid.

Just went under contract to purchase a home. I have lived in my primary residence since 1996. This was my parents home. The house was deeded to me in Aug 2006 when my Dad passed and Mom moved away. I have never purchased a home and now concerned/confused about whether I am eligible for the first time homebuyer credit. The language is not very clear.. HELP!

My husband purchased a home in 2000. I purchased a home in 1994. I moved into my husband's home in 2002, we married in early 2004 and rented my house out until it sold in 2007. We just purchased a new home in Feb. of 2010. Do we qualify for the $6500 tax credit since we shared the same residence since 2002?

Jamie, in addition to my previous questions listed above, my name was never put on his mortgage or deed, however we have been married for over 6 years and have lived in his home since 2002.

Karen, I'm afraid I don't know. My guess is that if the house was deeded to you, you would be considered a homeowner by the IRS -- certainly the state considers you a homeowner and sends you property tax bills as such, right? But you'd be best off consulting a tax expert.

Theresa, the IRS wants to know the first day that both spouses lived in AND owned the home. I'm no expert, but my understanding is that you counted as an owner the day you got married. So you'd be counting forward from that early 2004 date. I think that if you lived in and owned that home at least five years (meaning through early 2009), then you'd qualify.

Great Article. There are so many variations on peoples situations that is tough to know who qualifies and who doesn't.

Even better than the article is your willingness to come back and answer everyone's questions even months later.

What a great resource.

My husband and I have a contract to purchase another home to live in ourselves. He has owned and lived in the house we live in now for over 5 years and we have been married for 2 years, but my name is not on the current house. I have lived there for 5 years, except for a period of a few months. Would we qualify for the tax credit or would the few months disqualify us?

PS: When I moved out for the few months I never changed my address on my drivers liscense.

Intelligent Buyer, thanks for the praise. I'm glad you think it's useful.

R, I'm afraid that unless you bought the home with your husband or were added to the ownership five years ago, you don't qualify. Here's what the IRS says about the credit: "Both spouses must have owned and used the same previous principal residence for five consecutive years out of the 8-year period ending on the date of purchase of the new principal residence to qualify for the credit."

"Owned and used" is the key here. Marriage imputes ownership, but not before the marriage itself, if you see what I mean.

Hi, I have a tax question. We had a home purchase contract in April, and closed the escrow in May this year. Although this is an investment home for me and my spouse, it is also jointly owned by my daughter (whose name is in all title documents, and it is her first home indeed). My question is in 2010 tax return, can my daughter claim $8000 first-time-homebuyer tax credit?

Bill, this is direct from an IRS Q&A and seems to fit your situation:

--

Q: Taxpayer A is a single first-time home buyer. Taxpayer B (parent) cosigns for A and does not qualify. Both names are on the mortgage. Can Taxpayer A claim the credit and, if so, how much?

A. Yes. Taxpayer B is not a first-time homebuyer and cannot claim any portion of the credit, but A may claim the entire credit ($7,500 for purchase in 2008; $8,000 for purchase in 2009), if the home was purchased as Taxpayer A's primary residence.

--

Me again: There might be some subtleties in your situation that change the answer, but you'd need a tax expert to weigh in if so.

What happens if you are purchasing the home through a trust fund do you qualify for the tax credit? Even if you ar in contract by the 30th of April and closing by the the 30th of June?

Lashon, I'm afraid I don't know -- I've never seen anyone discuss trust funds in the context of the home buyer credit. I think you'll need to consult a tax expert.

We have been under contract on a house since April 22, 2010. We are scheduled to close on the same house on June 17.

Two questions:

1. We have asked the owner to do some repairs and have increased the offer price to pay for some of them. Same house, same contract, but there is an addendum regarding change in sale price. Do I still qualify for the first time homebuyers credit?

2. In general, how do I prove that the house was under contract by April 30? Send a copy of the contract?

Thanks for your feedback!

Hi, Ed. The second question is easy because the IRS has addressed it: "you should attach a copy of the pages from a signed binding contract to make a purchase showing all parties' names and signatures, the property address, the purchase price and the date of the contract." (More details here: http://www.irs.gov/newsroom/article/0,,id=218698,00.html)

The first question is trickier. I haven't seen informed discussion about whether addendums after April 30 disqualify people from taking the credit. Honestly, I can't see why they would -- as you say, it's the same house and the same contract. But I just don't know.

I bought my house in 1995 and got married in 1998. The deed is in my name. My wife and I were legally separated on 3/26/10. We can not get divorced by state law until 3/26/11. She signed a contract on 4/26/10 and closed on 5/26/10. Is she available for the $6,500 repeat home buyers tax?

Thanks for the feedback, Jamie.

Can you you repost the IRS link? It says "requested page does not exist".

Ed

That's very strange, Ed, because I'm staring at the working link and it appears to be the same as the one that isn't working. Let's try this again: http://www.irs.gov/newsroom/article/0,,id=218698,00.html

Or try this and go to "claiming the credit": http://www.irs.gov/newsroom/article/0,,id=187935,00.html

Howard, as far as I know, your wife would qualify for the credit (assuming her income and the price of the home aren't an issue). The IRS imputes ownership of a home to a spouse whose name is not on the deed, after all. As long as she lived in the home for at least five years of the last eight, it seems to meet the guidelines.

I'm no tax expert, of course.

I submitted an offer on the same house from 2/18-4/17 three times. The bank drug their heels about making a decision, and finally on 5/11 and accepted my offer. Here it is, 6/10 and I'm due to close escrow tomorrow. Is it safe to say I'm SOL on the tax credit? I was under the impression that there was a chance I qualified due to the offer form stating, "This is a legal, binding contract" and not stating signatures from both parties were required.

I have a question about what is considered a 'binding contract'. I had a signed purchase agreement from the seller of the home I am buying on April 23rd, 2010. Later, I find out that there are three other owners to the property who did not sign the purchase agreement until May 5th, 2010. Am I still eligible for the tax credit?

J.D. and lynn, I wish I had answers for you. I would think that a contract isn't binding until both buyer and seller has signed it -- otherwise, it's just an offer, right? But that's a question for a real estate attorney, as is whether a contract for a property with multiple sellers is invalid if only one of the sellers has signed.

Let me see if I can get some answers next week.

We had a legally binding contract on a home before April 30. There were problems with the house so we canceled that contract and wrote a new one on a different house (after April 30), which subsequently closed on June 7th. Does it matter if the house with the contract before April 30 is the same house you purchased before June 30th? The intent is still the same - we wrote a contract before the deadline - just ended up buying a different house.

Margie, I don't think the IRS will go for that. It wants to see that you had a contract by April 30 on a home you closed on by June 30. I'm no expert, mind -- that's just how I'm reading it.

I had a signed contract prior to the april deadline. The seller backed out of the contract, can I still purchase a house before the OCT 1 deadline and get the tax credit. thanks

Lee, see the answer to Margie immediately above your question.

Hi. My husband moved out in November of 2009 to his own home and recieved the credit of $6500 attached to our 2008 taxes. Our separation was legal last month (July 2010). Is half of the $6500 legally mine since it is attached to taxes when we were still legally married and filing jointly? Thank you for your clarification on this!!!

Valerie, I just don't know -- sorry. I've forwarded your question to the IRS. If I get an answer, I'll post it here.

I am married and I purchase a house and took possession at the end of March, 2010. My question is this. Do I qualify for the home buyers credit because only I purchased the house, not my husband AND me, but just me. He has AWFUL credit so I bought the house alone, but neither of us has ever owned a home before. Some one told me that it has to be a JOINT purchase... is this true? Also, if he has outstanding debts, should I expect some of my tax credit to be applied to those debts? Note: we filed a joint tax refund. Please let me know! Thank you very much.

My husband and I rented an old mobile home from his mom. We paid rent every month from 2004-2009. They sold us the property for 5000. We removed the old trailer and put a brand new double wide mobile home on the property. The irs says we do not qualify for the home buyers credit. I don't understand why.

Joni, sorry about the late response -- I lost track of your question. I don't recall seeing anything from the IRS requiring both members of a couple to purchase. As long as you both qualify, you should be fine. (As for the outstanding debts, I don't know -- it probably depends on the type of debt.)

Michelle, buyers can't qualify for the tax credit if they're buying from close relatives. That includes parents.

My wife has owned her condo for the past 8 years. She lived in it until we were married 2 years ago. She moved in with me when we were married. I have been renting for the past 5 years. We just bought a house. She qualifies for the $6500 repeat buyer and I qualify for the $8000 first time buyer. Are we to be punished because we don't qualify for the 'same' credit?? Can't we just take the lesser of the two? If sure seems unfair if we can't.

I had contract prior to April 30 th deadline but deal did not go through. Subsequently closed on another home by closing deadline but missed April 30th contract deadline. Can I still apply for credit?

Good site. My scenario is this. I purchased my home in Feb 2002 when I was single. Got married in Dec 2003 and my wife was never put on the deed since she wan't eligible based on not attaining permanent resident status until May 2005 plus never thought to do so anyway. Filed jointly all those years. Sold the house in April 2010 and under contract in April 2010 on new house which settled May 2010. I feel we meet the intent of the law. Please tell me we qualify!

Rob, did you wife not use the home as her principal residence until May 2005? If so, that might be a problem, because the home has to be the principal residence of both spouses for a full five consecutive years. But if both of you used it as the principal residence for at least five consecutive years ending April 2010, then I think you qualify. The IRS has noted that marriage "imputes" ownership of a home bought by one of the spouses to the other spouse as well. (Just remember I'm no tax expert.)

Sandra, I believe the IRS is firm on the April 30th deadline to sign a contract. Sorry -- I know others are in the same situation. (Not sure how I missed your question all this time -- sorry about that as well.)

Sam, a lot of people in your situation have asked the same question, but apparently the IRS is firm on this one. Sorry! I can understand how it doesn't make any sense to you. (Sorry I missed your question until now.)

How about this scenario -

home purchased in 2008 to serve as primary residence - did not get homebuyers credit at that time, but took deductions on 2008 tax return (mortgage interest, points)

before ever moving in, was activated by the National Guard and sent overseas until May of 2010 - rented the property while overseas

came back in 2010 and purchased a different home to live in, keeping the original as a rental property

is this eligible for the first time homebuyer's credit

Ann, here's an IRS Q&A that seems on point for you:

"A taxpayer owned her principal residence. Several years ago, she decided to relocate to a rented apartment, but did not sell the former residence. Instead, she rented it out to tenants. Now the taxpayer plans to buy another house and make it her new principal residence. Does she qualify for the first-time homebuyer credit?

"A. A taxpayer who owned rental property within the past three years is still eligible for the credit. The taxpayer cannot have owned and used a home as his or her principal residence within the last three years."

Link here: http://www.irs.gov/newsroom/article/0,,id=206294,00.html

I'm not sure if taking deductions on the '08 tax return is going to be a problem. According to the IRS, "The interest you pay on a mortgage on a home other than your main or second home may be deductible if the proceeds of the loan were used for business, investment, or other deductible purposes. Otherwise, it is considered personal interest and is not deductible."

Link: http://www.irs.gov/publications/p936/ar02.html