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Brandon M.
Brandon M., Family Law Attorney
Category: Family Law
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This would be a tax law question. My ex and I separated, physically,

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This would be a tax law question. My ex and I separated, physically, in May of 2005 when I took a job out of state and she decided she wasn't coming along. She filed for divorce in January of 2006. In the divorce settlement she got the house, but the divorce wasn't final until Febuary 3, 2007. Since the house (not a mobile home) was in Texas and I had taken up residency in Georgia, when did I cease to "own" the house? When she filed for divorce, or when the divorce was final? Her keeping the house was never contested, as I did not intend to move back to Texas. I think I lost beneficial possession (ownership) when she filed for divorce (or before), so that is when my ownership ended. Would that hold up with the IRS if I claimed the first time home buyer credit, which says you cannot have owned a home within 3 years of purchasing a home?

Hello there:

 

who's name was the home in as of May 2005? When did the title change?

Customer: replied 6 years ago.
The home was jointly owned as of May 2005. Actual title transfer was March of 2007.
You said that the divorce was final February 2007; although property division is typically handled at the time of the divorce, it can happen before or after the status of the marriage is actually changed. Was the order awarding the house to your wife in February 2007, or some other time?
Customer: replied 6 years ago.

She accepted the agreement which included her getting the house on Jan. 3, 2007, and the divorce was final 30 days later. It took six weeks or so from the date of divorce for her to actually get title. The agreement stating she got the house had been under negotiation for six months or so, but it was other details that had to be worked out. Her keeping the house was never in doubt so far as I was concerned.

Hello again:

 

beneficial possession and ownership are not the same thing, although they typically go hand-in-hand in a normal transaction.. For federal income tax credit purposes, ownership did not terminate until the court awarded the property.

 

That said, have you considered your eligibility for the $6,500 tax credit? Based on what you have said, there is a good chance that you would qualify.

 

I realize that this may not be what you had wanted to hear, but I do hope that you understand my philosophy that I cannot help people unless I tell them the truth, regardless of whether it is "good" news or "bad" news. Let me know if I may be of further assistance. Thank you.

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