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Merlo
Merlo, Accountant
Category: Tax
Satisfied Customers: 9783
Experience:  25+ years tax consulting. Specializing in returns for US citizens living abroad
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Do you answer questions about the homebuyer tax credit

Resolved Question:

Do you answer questions about the homebuyer tax credit?
Submitted: 4 years ago.
Category: Tax
Expert:  Merlo replied 4 years ago.

Hello JA Customer,

 

Please tell us what your particular question is concerning the homebuyer credit so we can try to help you.

 

 

Customer: replied 4 years ago.

We had a property purchase and sales binding agreement signed April 30, 2010. We had approved FHA funding from a bank that does not service FHA loans. Their loan package buyer invoked the "90 day rule" which states the seller must hold the property 90 days before putting it on the market. In order to obtain funding we were forced to execute a second contract dated 6/16/2010 which voided the original contract.

 

With the current extension of closing deadline (as of today) we would be eligible for the tax rebate IF:

 

1) the original contract could be deemed valid by the IRS for this purpose to be submitted along with the closing contract

or

2) an option to buy binding agreement signed by seller and buyer and dated 4/30/2010 for property to be available 6/16/2010 would be deemed a valid binding agreement by the IRS.

Customer: replied 4 years ago.
What do you need to know??? I NEED TO KNOW IF EITHER OF THOSE 2 POSSIBILITIES IS ACCEPTABLE TO THE IRS IN ORDER TO GET THE TAX CREDIT. I HAVE A TERMINATION LETTER WAITING ON THE ANSWER TO THIS RECENT DEVELOPMENT
Expert:  Merlo replied 4 years ago.

Hello again JA Customer,

 

We have had several questions come through the forum recently along these same subject lines, where for one reason or another a home buyer has been forced to cancel his original sales contract and sign a new one which was dated after the April 30th deadline.

 

While Congress has passed legislation to extend the closing date to September 30th, no provisions have been made to allow for a change in the sales contract. If your initial sales contract was voided, for whatever reason, and a new sales contract was not signed until after the April 30th date, then the credit cannot be claimed. Also an "option to buy" contract dated April 30th would not be acceptable.

 

You can certainly go ahead and submit an amended return for 2009 once you complete the closing and attempt to claim the credit by attaching a copy of your original contract along with a statement explaining the reason for the change, but it is not likely the credit will be approved unless you simply get lucky and it passes the approval of the agent assigned to your claim.

 

I am truly sorry I could not give you a more favorable answer here, but unfortunately the IRS has not allowed any changes to the rules for the April 30th date.

 

If this was helpful please press the Accept button. It is the only way we receive any credit for helping with these questions.

 

Thank you JA Customer

 

 

Merlo, Accountant
Category: Tax
Satisfied Customers: 9783
Experience: 25+ years tax consulting. Specializing in returns for US citizens living abroad
Merlo and 2 other Tax Specialists are ready to help you
Customer: replied 4 years ago.
Thank you. I've already pushed the accept and pay button...wish the answer were different but it's good to get some information. Peace, Sandra
Expert:  Merlo replied 4 years ago.

Thank you Sandra. I really do sympathize with you in this situation. But as I said, you have nothing to lose by submitting your claim for credit anyway just to see what may happen.

 

 

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