FTHBC

[ILLMAS]

IRS is doing something to prevent First-Time Home Buyer Credit for a change, now sending copies of the HUD statement is not enough. One of my client bought a home in March 2010 and paid it cash, we submitted his tax return in October and in December he recieved a letter stating the IRS was still in the process of reviewing his return, well today he recieved a certified letter giving 5 options to proof he lives in that house, IRS wants to see owners bank statement or driver license or utility bills or vehicle regristion to make sure it ties to the address. I guess the IRS really wants to make sure you live there and it's not a rental property or your address is the county jail.

[grandmabee]

little late coming to the party aren't they? I guess better late than not at all

[Pacun]

little late coming to the party aren't they? I guess better late than not at all

I posted that letter on this forum about a year ago.

PS: I looked for my post but I din't find it. Maybe I never post it.

[Cathy]

IRS is doing something to prevent First-Time Home Buyer Credit for a change, now sending copies of the HUD statement is not enough. One of my client bought a home in March 2010 and paid it cash, we submitted his tax return in October and in December he recieved a letter stating the IRS was still in the process of reviewing his return, well today he recieved a certified letter giving 5 options to proof he lives in that house, IRS wants to see owners bank statement or driver license or utility bills or vehicle regristion to make sure it ties to the address. I guess the IRS really wants to make sure you live there and it's not a rental property or your address is the county jail.

Yep, you're right. The credit starting with the tax year of 2008 could be e-filed and deposits were sent to banks within the normal refund schedule.

Then...IRS found out that many people (including some locked away in cells for years) were receiving refunds fraudulently.

These returns whether amended or on original 1040's are now taking months (as in 8 to 10) as IRS is scruitinizing each and every return with the FTHBC. The interest your client will receive is nice, however. I'm surprised that return has come so far in 4 months. Perhaps they caught up with their backlog...somewhat anyway.

Cathy

P.S. Tip: If taxpayer has all 5 items, send them all. Too much info is so much better than not enough in this instance. ;)

[Pacun]

The interest your client will receive is nice, however.

Cathy

Keep your eyes open next year because the Tax payer must report that interest. Remember that the IRS will have its eyes wide open for that interest since it knows for fact that it was paid.

[Cathy]

Keep your eyes open next year because the Tax payer must report that interest. Remember that the IRS will have its eyes wide open for that interest since it knows for fact that it was paid.

You're absolutely correct! ;)

[GeneInAlabama]

Now that they have cracked down on FTHBC, how about EIC?

[joanmcq]

MAS, they've been requiring proof of residence for the last year, in fact with all of the 2009 returns. Where've you been?

[ILLMAS]

MAS, they've been requiring proof of residence for the last year, in fact with all of the 2009 returns. Where've you been?

In 2009 I only had 1 FTHBC and in 2010 had 2, one was for my sister, had no problem with hers, amended her return sent a copy of the HUD and and a copy of the loan and in two months she recieved the credit, the second one is the one I mention above, TP and had no income, paid 30K cash for the house and qualfied for 3K credit. Anyway we are going to send the requested information and wait.

Q. What do I have to attach to my 2009 or 2010 return to prove that I bought a new home in order to claim the credit?

A. If you claim the credit on a 2009 (or later) return, you must attach a copy of your settlement statement. For most homebuyers, this will be a properly executed Form HUD-1, Settlement Statement (U.S. Department of Housing and Urban Development) that includes:

Names and signatures (if available) of all parties involved, Check

Property address, Check

Purchase price, and Check

Date of purchase. Check

If you purchased a mobile home and do not have a settlement statement, you should attach a copy of your executed retail sales contract showing all parties' names and signatures, the property address, the purchase price and the date of purchase. N/A

If you are claiming the credit for a newly constructed home and you do not have an executed settlement statement, you should attach a copy of your certificate of occupancy showing the name of the taxpayer, the property address, and the date of the certificate. N/A

As you see, what was required on the HUD statement (Name, signature, address, price and date of purchase) was submitted This was not a mobile home or construction in progress, so you can say we complied with the required documentation.