Updates to Home Buyer Credit - Tax tip of the week

Back in November, we discussed the First-time Home Buyer Credit and the Long-time Resident Credits in detail. The IRS recently published some updates that you will need to know to qualify for either of these credits.

1. First and most importantly, don’t miss the deadlines! You must have a contract on the new home in place by April 30, 2010 and the property must close by June 30, 2010.
2. The IRS recently released a revised Form 5405 which is needed to claim the credit.
3. If a return contains Form 5405, it cannot be e-filed (filed electronically.)  You must mail the completed tax return to the IRS.
4. If you are claiming the First-time Home Buyer Credit, you must attach the closing statement (HUD-1) to the return.
5. If you are claiming the Long-time Resident Credit, you must attach evidence that you lived in your old home for a five-year consecutive period during the eight-year period ending on the purchase date of the new home.  This evidence could be:  mortgage interest statements (Form 1098), property tax records or homeowner’s insurance records.
6. For those filing their 2009 tax returns early, the IRS does not anticipate issuing any refunds until the end of March.

The added documentation is designed to deter fraudulent claims. We’ll keep you posted on any other changes and announcements on this topic.As always, give us a call if you have any questions. In Dayton, call 937-436-3133 and in Xenia, call 937-372-3504. Or visit http://www.bradstreetcpas.com.Rick Prewitt - the guy behind TTW...until next week.