IRS requirements for First-Time Homebuyer Credit and Long-Time Resident Credit

If you are lucky enough to be selected by the IRS to show proof of eligibility for the First-Time Homebuyer Credit or the Special Rule for a Long-Time Resident, you will need to make sure that you have the following information for them.

You will need to provide all fo the following if it was not filed with your return:

• A copy of the settlement statement, the buyer(s) and seller(s) names, the property address, the purchase price and date of purchase.  If the settlement statement is unsigned, also provide a copy of the final purchase/sales contract.
• If you purchased a mobile home, a copy of your executed retail sales contract, the property address, the seller(s) and buyer(s) names, purchase price and date of purchase.

AND

• A copy of your most recent monthly/quarterly mortgage statement.

              NOTE:  If your purchase was financed through a private mortgage and statements are not available, you will need to provide a copy of a cancelled check (front and back) from  a payment made within the last 3 months.  If your purchase was a cash sale, you will need to provide proof you paid for the property - a copy of your cancelled check(s) (front and back) or other payment instrument.

AND

• A copy of the certificate of occupancy if the home you purchased was a newly constructed, or a manufactured (modular or mobile/trailer) home and you are the first occupant(s).

You will need to show verification that the new property is your primary residence and will have to provide at least 2 of the following:

• Current driver's license or other state-issued identification showing your name and new address.
• Recent pay statement (within the last 2 months) showing your name and new address
• Recent bank statements (within the last 2 months) showing your name and address
• Current automobile registration showing your name and new address
• Change of address confirmation from the U.S. Post Office showing your former and new address
• Contract from moving company indicating you receipt of transported household items, showing points of origin and destination.

If you are claiming the credit as a Long Time Resident, you must verify that you lived in the prior residence for 5 consecutive years, during the 8 years prior to the date you purchased your new primary residence, please provide at least 2 of the following:

• Copy of the final closing contract showing the buyer(s) names, date of purcahse and proeprty address of your prior residence.
• Copies of tax statements and cancelled checks showing real estate tax payments for the property for at least 5 consecutive years; the information should show the address of the property.
• Copies of annual mortgage interest statements for 5 consecutive years.
• Any other information which shows your ownership of the prior residence, and that you used it as a principal residence for 5 consecutive years.  This may include copies of homeowners insurance policies, statements from utility companies, or school records which show your name(s) and address.

Not that everyone will get an audit for their tax credit but if you do, you can be prepared for what they will ask for.  You will only be given 30 days to provide this information back to them.

Hope that this information has been helpful.

Christine Stalsonburg, Realtor

Real Estate Consultant

Exit Realty Paramount

231-409-4140

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