How I Obtained the Move-Up/Repeat Homebuyers' Credit from the IRS

In 2009, President Obama and the IRS offered two types of homebuyers' tax relief: first time and "long time" or move-up/repeat home buyers' credit. This is my experience in successfully obtaining the longtime homebuyers' credit from the IRS.

My husband and I purchased a condo in a short sale last year. By doing so, we were eligible for the longtime homebuyer's credit, since the purchase was not our first home. We called our tax accountant to inquire about what type of documents were needed to file for the credit. Also, we wanted to know when/how to file for the homebuyers' credit.

The tax accountant said we had the choice of applying for the longtime home buyers' credit when we file for our taxes the following year or could amend our tax return from the prior year to apply for the tax credit. The tax accountant said we could receive up to $6,500 for the credit if we were qualified and submitted all required documentation.

We decided that, since we didn't know how long the monies would actually be available since government funds do run out, we'd go ahead and amend the prior year's tax return to apply for the longtime tax credit. Little did we know that in a few months, we'd be $6,564 richer.

Here's how we successfully applied for and received the longtime homebuyers' tax credit:

- We had to submit proof we'd lived in our then-current "owned" residence for at least five years.

-We enclosed lots of documents. Since I'd saved the last 10 years of all house receipts, I had every single utility bill we'd ever paid while living in our then-current home. So, rather than sending the IRS just 5 years of proof we'd been living in our (then) currently owned home, I sent them all 7+ years of utility bills. So, save your receipts-you never know when you might really need them.

-We were also required to submit a copy of the settlement statement from the new property we purchased, which we had in a file.

-Of course, we completed the IRS Form 5405 and a corrected Form 1040 to show the homebuyers' credit on line 67.

Within 6 weeks of mailing in the IRS forms and documentation, we received a letter informing us we would receive the $6,500 tax credit! We were cautiously excited. Within 2 weeks after getting the letter, we received a check for $6,500 plus interest of $65.64. Of course, we were thrilled to find that with diligence and follow-through, we were given over $6,500 from the IRS.

Thank heavens I saved all those utility bills and knew just where to find them!

Sources

Federal Housing Tax Credit website

Internal Revenue Service website

Personal Experience