Discussion:First time homebuyer - amend or wait?

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Discussion Forum Index --> Basic Tax Questions --> First time homebuyer - amend or wait?


Discussion Forum Index --> Tax Questions --> First time homebuyer - amend or wait?

Waynecpa (talk|edits) said:

3 November 2009
At an IRS Practitioners Forum last week, a presenter said amended returns are taking 16 weeks (or more). This would be toward the end of February for a 1040X filed today. What are you advising people with a first time homebuyer credit to claim on an amended return? Amend or wait until the 2009 filing season?

Cody2826 (talk|edits) said:

3 November 2009
I did a few amended returns and the taxpayers got their refunds in about 6 weeks. Make sure you attached the closing statement to the amended return.

TAXBILLY (talk|edits) said:

3 November 2009
Why wait? Interest will not be paid on the credit.

taxbilly

Taxmentor (talk|edits) said:

4 November 2009
I wouldn't wait...I filed an amended 2008 return for a client on September 28th to get

the $8,000 refund for the first time homebuyer credit and he just received his refund over the weekend with INTEREST OF $125.

Waynecpa (talk|edits) said:

5 November 2009
Thanks. I suppose the interest in itself is the reason to file the 1040X, even if it goes the 16 weeks estimated (sounds like it would be less, though). If you wait until 2009 as Taxbilly says, there will not be interest.

Taxestaxes (talk|edits) said:

13 November 2009
CODY - interested as to why you said included the closing statement? When i talked to IRS they said not to bother sending; if its required they would ask?? The lady I talked to acted as if it were included they ignored it anyway?? Just curious? I have had people get their amended refunds in as little as 4 weeks; havent had anyone send in the closing statement yet.

Thanks.

Death&Taxes (talk|edits) said:

13 November 2009
Wayne writes: "At an IRS Practitioners Forum last week, a presenter said amended returns are taking 16 weeks (or more)." Did it ever occur to any of us that such pronouncements are almost routine, and are a way to try to cut their work load? For IRS it would certainly be easier to process a 2009 efiled return with a FTHBC claim than a paper amended return.....so they will say all they can to discourage such. Lines like this are like the repeated threats of reasonable compensation audits on S Corps. Sometimes I think IRS has studied the tactics of Keyser Soze, or rather Verbal's definition of Soze, a 'spook story.'

Fsteincpa (talk|edits) said:

13 November 2009
taxestaxes - If you don't submit documentation, the IRS is more than likely to request it after the fact, further extending the time to receive the refund. I have done a few and in each and every case, they have come back requesting the closing statement, or some other proof of purchase.

SpicoliCPA (talk|edits) said:

13 November 2009
I have filed 5 1040x's for this credit and have not heard from IRS requesting additional information. Maybe I am lucky or maybe my clients did not refer the IRS letter they received to me...Of note here is that I will be charging my client $150 to amend their return. Any interest will largely be wiped out by my fees. I express the WHOLE equation to my clients and let them make the choice.

Waynecpa (talk|edits) said:

13 November 2009
I wonder if they meant other 1040X's besides the FTHBC ones. Yesterday I talked to two clients who I did 1040X returns for. In each case they said they received a letter after 16 weeks saying their return was being pulled for review and it could be another month.

Lusaco (talk|edits) said:

13 November 2009
A client of my is closing on a house next week. And he will qualify as a long-term homebuyer and take advantage of the $6,500 credit. Is it possible for my client to file papers to receive this refundable credit prior to filing his 2009 tax returns?

Thank you

Cotopop (talk|edits) said:

15 November 2009
Not really sure because the 2008 Form 5405, which should be attached to an amended return, has not been updated ,to reflect the $6,500 credit. If you get through that hurdle be sure to attach the settlement statemnt to the amended return as that is now a requiremnt .Also be aware aware that if an amended return is filed taxpayer will be subect to the substantially reduced AGI phaseout of $75,00-$95,000 Single and $150,000- $170,000 MFJ . AGI phaseouts are substantially increased if he waits and files with the 2009 return.

TAXBILLY (talk|edits) said:

15 November 2009
The revised form is being worked on:

http://www.irs.gov/app/picklist/list/draftTaxForms.html?value=5405&criteria=formNumber taxbilly

Cotopop (talk|edits) said:

15 November 2009
A review of the text indicates that the 2008 revised 5405 form can only be used for purchases before November 7,2009. This is contrary to the language in the bill so we will have to wait and see.

Cotopop (talk|edits) said:

21 November 2009
The 2nd draft form makes it clear that the 2008 form 5405 can only be used for purchases before Novemeber 7,2009. This makes sense as the form already contained provisions for 2 separate law changes.

DZCPA (talk|edits) said:

23 November 2009
Filed 6 1040X for the credit without attaching closing statements with no IRS inquires. They do not want it unless you get audited for the credit.

JBinSC (talk|edits) said:

25 November 2009
Wow. This sounds like bad news for one of my clients. She purchased her home on Nov 17th and qualifies for the $8,000 credit. I just came across that notice in the instructions.

It appears we can't file her 1040X until the revised 5405 comes out because it contains information regarding the $6,500 credit which doesn't even apply to her. Doesn't make much sense to me. Simple logic would suggest that only those taxpayers claiming the $6500 credit should have to wait for the revised form.

Unless I'm missing something, I suppose anyone with a client in her situation should take a wait-and-see approach until the revised form is published. At that point one can decide whether to file a 2008 1040-X or include it on the efiled 2009 return.

Death&Taxes (talk|edits) said:

25 November 2009
Discussion: E-File w/Form 5405

You may not be able to efile in 2009.

Umk395 (talk|edits) said:

27 November 2009
You definitely should attach a copy of the closing statement. I filed 4 1040X for 2008 and my clients got their refunds back within 6 weeks also.

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