What is the name of your state (only U.S. law)? Washington
I've been searching the IRS.gov website for information on this topic, and wanted to clarify if I'm reading it right.
My partner and I want to buy a house. He has owned a house in the last three years, so he would not qualify as a first time homebuyer under the restrictions. I, however, have not. I fit all of the qualifications as a first time homebuyer under the IRS's guidelines as I read them, I have the requisite down payment, and my debt to income ratio is good. The kicker is that I have the lower credit score, so in order to qualify for a really good loan, we would most likely need to do something that would take his income/credit score into consideration. Our thoughts were to do something like have me primary on the loan but list him as a co-signer. We've been working with a mortgage broker who stated that she could secure such a loan for us with those terms, but could not advise us on the tax implications.
It would seem that I should be able to take the tax credit, as I am primary on the loan. I found this guidance (verbatim) on the IRS's instructions for the first time homebuyer credit form:
What sort of tax advice should we seek before pursuing a mortgage under these conditions? Whatever we do, we want to make sure all of our ducks are in a row and we've done things the right way. Can anyone shed some light?
I've been searching the IRS.gov website for information on this topic, and wanted to clarify if I'm reading it right.
My partner and I want to buy a house. He has owned a house in the last three years, so he would not qualify as a first time homebuyer under the restrictions. I, however, have not. I fit all of the qualifications as a first time homebuyer under the IRS's guidelines as I read them, I have the requisite down payment, and my debt to income ratio is good. The kicker is that I have the lower credit score, so in order to qualify for a really good loan, we would most likely need to do something that would take his income/credit score into consideration. Our thoughts were to do something like have me primary on the loan but list him as a co-signer. We've been working with a mortgage broker who stated that she could secure such a loan for us with those terms, but could not advise us on the tax implications.
It would seem that I should be able to take the tax credit, as I am primary on the loan. I found this guidance (verbatim) on the IRS's instructions for the first time homebuyer credit form:
By this definition of the rules, can I read this to mean that I can allocate all of the credit to myself rather than my partner, since to allocate part to him would be giving credit to someone who is not eligible? It does say "ANY reasonable method". Who determines what is 'reasonable' to the IRS? Is that a rhetorical question?LINE 1: If two or more unmarried individuals buy a main home, they can allocate the credit among the individual owners using any reasonable method. The total amount allocated cannot exceed the smaller of $7,500 ($8,000 if you purchased your home in 2009) or 10% of the purchase price.
Note: A reasonable method is any method that does not allocate all or a part of the credit to a co-owner who is not eligible to claim that part of the credit.
What sort of tax advice should we seek before pursuing a mortgage under these conditions? Whatever we do, we want to make sure all of our ducks are in a row and we've done things the right way. Can anyone shed some light?