Home Buying in 92071>Question Details

Luke, Home Buyer in 75024

A bit complex question for $8K first time home buyer credit, about couple planning to get married?

Asked by Luke, 75024 Fri Sep 25, 2009

I surfed online about $8k credit topic but didn't see my situation answered. I am planning to buy an apt as the first time home buyer and understand that I need to keep that apt for 3 yrs as the principal residence.
However, My gf has a house with mortgage so she will use that as the principal residence to file tax return. If we get married, what's the best way to file tax return?
If I need to meet the 3 yr principal residence requirement, does it mean that we will need to file tax return separately during the period of time even our houses are just 10 miles away? If so, will we end up paying more tax because of filing separately?
ps. She has more income than me
Thank you!.

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Answers

3
I took this information directly from the California Association of Realtors Legal Q&A for you. It states the following:

You are not eligible for the tax credit if the taxpayer owned another main home at any time during the three years prior to the date of purchase. For a married couple filing a joint return, this requirement applies to both spouses. For example, if the taxpayer bought a home on Sept. 1, 2009, the taxpayer cannot take the credit for that home if he or she owned, or had an ownership interest in, another main home at any time from Sept. 2, 2006, through Sept. 1, 2009.

In conclusion and in answer to your question, I would take this to mean that you would need to file separate returns in order for you to receive any benefits from the tax credit. But only if you are to purchase a residence and close escrow before the Nov. 30th deadline and prove that you have not held an ownership interest in any home for the three years prior to the purchase.

You will need to calculate the difference between what you stand to gain by filing jointly with no tax credit vs. filing separately and receiving the tax credit. The limit is $4,000 for a married person filing a separate return.

Please confirm all this information with your tax advisor before making any decisions. Good luck to you! Congratulations on your engagement and pending wedding!

Diane Wheatley, Broker
diane @moveupproperties.com
(909) 981-5400
0 votes Thank Flag Link Sat Sep 26, 2009
Luke,

Definately check with your tax advisor as suggested by Patti. Check the IRS website at :

http://www.irs.gov/newsroom/article/0,,id=206291,00.html

All the Best,

Marcie Sands, REALTOR
SImply The Best Real Estate Co., Inc.
760-644-1562
0 votes Thank Flag Link Fri Sep 25, 2009
Luke, This is a question you may want to ask your tax person. They would be the best person to ask for your specific situation, and could tell you the best way to make it work. Keep in mind- the time for the tax credit is almost behind us! It may be continued, but we don't know for sure yet.

Patti Phillips
"Advice you Need, Attention you Deserve"
800-680-9133 or 619-507-2100
0 votes Thank Flag Link Fri Sep 25, 2009
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