Documentation Requirements for the First-Time Homebuyer Credit

[kcjenkins]

The IRS is providing more information regarding documentation requirements on the First-Time Homebuyer Credit. The IRS encourages buyers seeking the homebuyer credit to sign the settlement statement when they file their tax return -- even in cases where the settlement form does not include a signature line.

The IRS recognizes that elements of the settlement document, often a Form HUD-1, may vary from jurisdiction to jurisdiction and may not reflect the signatures of both the buyer and seller. While the Form 5405 instructions indicate that a properly executed settlement statement should show the signatures of all parties, the IRS has clarified that it will accept a settlement statement if it is complete and valid according to local law. In areas where signatures are not required on the settlement document, the IRS encourages the buyer to sign the settlement statement prior to attaching it to the tax return. In situations where the signature of the seller is not on the settlement document, the IRS advises the buyer to still sign the document.

My link

[jainen]

>> it will accept a settlement statement if it is complete and valid <<

In other words, "We don't know what to tell you. Congress made the rules so tough that it is technically impossible for anyone to comply, so just do the best you can and we'll work with you on it." Now, that's MY kind of bureacracy!

[kc, long links like that don't pick up properly so we have to copy and paste to get the whole thing. But if you use the My Link feature, it works nifty!]

[kcjenkins]

Sorry about that. I fixed it. A good reminder, tho. Not promising I will remember, but I'll try.

[Margaret CPA in OH]

Jainen, what is the My Link feature, that is, how does one use it? I've seen it here a few times but thought only computer tech geniuses could manage such magic. But maybe that is the case after all!

[kcjenkins]

It's easy Margaret. When you click on either fast reply or reply, you see a number of icons right above where you are typing. The obvious ones like the one for Bold, Italic, etc, then there is the little smilie for the emoticons, and the very next one, like a little short chain, is the 'insert link' button. If you have 'copied' a link you want to post, instead of just using 'paste', click on that icon, then paste the link in the box that appears. What will show up in your post will be a little blue MyLink that will work on any size URL. While just using 'paste' will work OK for short URLs, it often does not work well for long ones.

[fredazcpa]

First time home buyer docs needed.pdfI got this from a client, they received it from the IRS when requestioned more information for the FTHBC

[Margaret CPA in OH]

Thanks, KC, for again furthering my education. Someday I am going to fully explore this site and actually try out some stuff. Maybe even a dive picture! (I'm still working on Photoshop with the Indo trip. At least I now know some basics.)

[kcjenkins]

I'm going to request that Form 886-H-FTHBC be added to the program, so that we could add it to any client who is claiming the credit, both to give the client a copy and to have it in my file as proof that I told them. Anyone else who wants to add that request to the 'suggestion box' on the MyATX site?

To request a form that the program does not include, go to the "Find a Form" link, then on the page that pops up there is a link in the second paragraph to the 'Request a Form' page.

[kcjenkins]

Just a quick followup, got this back from ATX forms folks.

The following Request Status provides the latest information we have regarding your request: Form 886-H-FTHBC is being considered for development. You will receive an update regarding the status of our decision at a later date.

[TAXBILLY]

Since it is merely an information sheet why not download it from here and give it to your clients:

http://www.irs.gov/pub/irs-pdf/f886hfth.pdf

Another information sheet of interest:

http://www.irs.gov/pub/irs-pdf/f886haoc.pdf

taxbilly