Discussion:FIRST TIME HOMBUYER FROM ESTATE

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Discussion Forum Index --> Basic Tax Questions --> FIRST TIME HOMBUYER FROM ESTATE
Discussion Forum Index --> Tax Questions --> FIRST TIME HOMBUYER FROM ESTATE

Mrbarrytax (talk\|edits) said:	29 August 2009
Client has purchased home from estate of her grandmother with her boyfirent. Is estate considered related party?

TAXBILLY (talk\|edits) said:	29 August 2009
Is she a beneficiary? taxbilly

Mrbarrytax (talk\|edits) said:	29 August 2009
I have not asked her that question. Let's ASSUME SHE IS A BENEFICIARY OF ESTATE, would she be disqualified but boyfriend still eleigble to take entire or half of first time homebuyer credit?

Riley2 (talk\|edits) said:	29 August 2009
The property cannot be acquired from a person related to the person acquiring the property.

Riley2 (talk\|edits) said:	30 August 2009
PS, the beneficiary is automatically considered to be related to the executor.

Mrbarrytax (talk\|edits) said:	30 August 2009
part two of the question, would boyfriend be entitled to take entire or half the credit?

Blrgcpa (talk\|edits) said:	30 August 2009
As far as I understand, ALL purchasers must qualify for the credit or no one can take it.

SCCPA (talk|edits) said:

30 August 2009

While a husband and wife must both be eligible, I know of no requirement that unrelated owners be eligible. To the contrary, the IRS Q & A discusses allocating the credit between buyers, and indicates that none of the credit would be allocated to any buyer who is ineligible for it. In this case, I believe the boyfriend could claim the entire credit.

From http://www.irs.gov/newsroom/article/0,,id=206291,00.html - "A reasonable method is any method that does not allocate any portion of the credit to a taxpayer not eligible to claim that portion."

Riley2 (talk|edits) said:

30 August 2009

I honestly don’t know. Clearly, the property was acquired from a person related to the person acquiring a portion of the property.

I looked at the 1975 regulations on the Sec. 44 credit which is very similar to the Sec. 36 credit. Old Reg. 1.44-5 seems to imply that an acquisition is disqualified if made from a Sec. 267 related party (other than a sibling).

However, I don’t know if the Sec. 36 regulations will be patterned after the old Sec. 44 regulations from 1975.

Andrewz (talk|edits) said:

31 August 2009

See IRS Notice 2009-12 http://www.irs.gov/pub/irs-drop/n-09-12.pdf, page 3 under the subtitle Application. As SCCPA mentioned: "A reasonable method is any method that does not allocate any portion of the credit to a taxpayer not eligible to claim that portion." If all taxpayers would be ineligible in a joint purchase because any one of them is ineligible then that sentence wouldn't be in the IRS Notice. It seems like the deck is stacked against married taxpayers when it comes to the FTHB credit.

ICOUNT (talk\|edits) said:	31 August 2009
I disagree---yes the grandmother is a related party----but if the purchase is made from her estate--the estate is not a related party even if she is a beneficiary... True she could not have inherited the property but she purchased it. Where is she a related party under IRC 267? Please provide your cite.