How does the IRS verify eligibiliy for home buyer tax credit?

My home was included in a Chapter 7 Bankruptcy. Discharge was back in 2005. However, my appraisal district's website shows that that the deed was not taken out of my name until September 2007. I closed on a new construction home before July 1st. the sales contract was done prior to May 1st. So I would think that I would qualify for the tax credit. However, I am not sure if the IRS would exclude me for the tax credit because of the deed history. How does the IRS determine the eligibility dates? What process/system do they use to calculate the 3 year prior purchase period?

4 Answers

  • 9 years ago
    Best Answer

    The IRS uses a variety of means to attempt to discern prior home ownership. Of course, the first place the IRS looks is PREVIOUS tax returns under your SSN. Any indication that you have owned a home anywhere close to the three year time limit sends the IRS digging into local records to determine if and when you disposed of a previous property. Yes, you WILL be caught if you try to cheat the system.

  • 4 years ago

    The IRS only sends federal tax credits. It does not send California tax credits. California tax credits can only be sent by FTB (franchise tax board). They cannot be sent by the IRS. There are clearly many individuals who have received first time homebuyers credits from the IRS, because many of them have posted questions here concerning whether they need to repay the first time homebuyer credits that they received from the IRS.

  • Flower
    Lv 7
    9 years ago

    I think the deadline was April 30th for the new home tax credit but check the IRS website.

  • ?
    Lv 7
    9 years ago

    The day the house transferred out of your name

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