Lynn,

You have a great question here.

A lender will be able to work with you to help you get your answer. If you need a reference for a good lender I will be happy to provide you with several.

My gut on this one tells me no, but I'm not a lender. This most likely depends on how much you owe and what your debt to income ratio is.

James Dudley
ERA Sunrise Realty
678-781-7418
james.dudley@era.com

Your question needs a lender and an accountant to answer. The back taxes will count against your debt to income as it is a debt. Loan guidelines have changed and continue to change. Your lender will be able to tell you if the back taxes need to be paid in full or if the payment plan in place is acceptable.

I am not an accountant and you should really contact your accountant or the company who does your taxes for you. I am not an accountant and I am not providing accounting advise. The following example is how I have known the IRS to work in the past.The IRS usually deducts outstanding balances owed from future refunds. Meaning if you owed taxes on your 2007 tax return and you have not paid those taxes but you have a refund on your 2008 taxes then they will take the refund and apply it towards the amount owed from 2007. The tax credit is a credit on your taxes not a credit at the closing of a home. Once your taxes are filed taxes owed will be subtracted from the credit and you will receive a tax refund for the difference if there is money left on the table.

May I suggest for lending:

Kathleen Terry
Mortgage Consultant
Wells Fargo Home Mortgage
M2044-021
(770) 497-6018 Tel
(866) 581-5837 X1018 Toll-free
(866) 676-1044 Fax
Kathleen.A.Terry@wellsfargo.com http://WWW.WFHM.COM/kathy-terry

Lynn, You need to check with a mortgage person, to see what the status is.