BulldogTom Posted February 3, 2010 Report Share Posted February 3, 2010 Client is married. Spouse is a Resident Alien. Spouse did not have green card until late in 2008. Purchased home in 2009 and ammended 2008 return to claim homebuyer credit. On the 2008 return, the spouse used his ITIN number. He received his SS number in 2009. IRS has disallowed credit on 2008 1040X claiming spouse is not qualified unless he can prove he is a resident alien. I am now representing the clients in their appeal. I am looking at the code and it does not address how long during the year the spouse must be a resident alien. He was definately a resident alien at the time of the purchase in 2009 and the home was purchased in both spouses names as joint tennants. There are two ways that I see to approach this, but the code is not clear as to the timing of determining resident alien status. The code says the credit is disallowed for an person who is a non-resident alien for the tax year. I don't know if that means at any point in the tax year, or if status is measured at the end of the tax year (like marital status). If it is measured at the end of the taxable year, then the fact that he has a green card at the end of the year should be all that is needed to prove status for the appeal. If the taxpayer has to have had his green card for the entire year, we can meet the substantial presence test for 2008, but is much more difficult to document. ANOTHER POSSIBILITY I don't see where the election to claim the credit is irrevocable. Is it possible to revoke the election to amend the 2008 return and claim the credit on the 2009 timely filed return? I am just going through possible scenarios as to how to represent this client and would like some of your feedback. There is very little guidance on this credit in my research materials. Thanks for your help. Tom Lodi, CA Quote Link to comment Share on other sites More sharing options...
BulldogTom Posted February 3, 2010 Author Report Share Posted February 3, 2010 Found it. Code section 7701((1)(A)(i) of the Internal Revenue Code provides that an alien who is a Lawful Permanent Resident of the United States at any time during a taxable year shall be considered to be a resident alien for the entire tax year. Sweet. Tom Lodi, CA Quote Link to comment Share on other sites More sharing options...
jainen Posted February 5, 2010 Report Share Posted February 5, 2010 >>Sweet<< Yeah, ain't America great! Quote Link to comment Share on other sites More sharing options...
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