After death of my mother, paying mortgage for 2 years, then applying for loan to purchase the home, qualifying and then to be told by IRS I qualified then 3 years later I don't qualify and owe almost double the credit is completely ridiculous. I'm a hardworking American. Dont take advantage of government and the one time I actually think they are going to help me, I get side swiped by that one stipulation about buying from relative. Very frustrated!
I was unable to get a mortgage in 2003 due to a divorce. My dad purchased a condo and I lived here and paid all the bills/taxes. In 2009 I was able to obtain my own mortgage and purchased it from him. I paid the full appraised price and took a mortgage for the amount, the condo was not gifted or signed over to me, I paid full price, then found out I was unable to claim the tax credit. I do understand the IRS's position in disallowing people to give or merely sign over homes to relatives so they may claim the credit, however there should be provisions for people who actually purchase a home from a relative, go through ther appraisal, and mortgage process just like any other homebuyer. There are thousands of dollars in closing costs it would hardly be worth it for someone to get a home from a relative to "scam" they would just about break even after closing costs. I am also a single mom and the mortgage co told me I could claim the tax credit becuase I payed full fair appraised & fair market price, I was out of luck....
My family situation is not in this category. We were disqualify because the binding contract is written on May 6th although we bought our house in June last year. Even though the deadline is extended to October 1st, it said that a binding contract should be written before May 1st. I just feel it is so unfair.
My son bought his childhood home from us at the full appraised value. His very first home and he doesn't qualify for this credit???? Our government should change this immediately. He could have bought a home for much less and qualified. But because this home, that had been on the market for 4 years, had sentimental value to him he purchased it all the while helping out the economy just like someone who bought the house down the street. He thought that he would have this credit to help do the repairs that were needed. Now nothing? The bank owns this house until he pays them back in 30 years, not his parents. Hey, government, do what is right and make this thing right for your hardworking law abiding citizens. This is an outrage!!!
My husband and i bought a home last year had trouble getting a mortgage so my father paid cash and did a land contract to pay him back, My parent never lived in the house, they only own it for a month on a piece of paper.this is discrimination! why does it matter who own your home or who loan you the money. This needs to change now.
THIS IS SO UNFAIR! MY MOTHER PASSED AWAY AND WE WANTED THE HOUSE TO STAY IN THE FAMILY. MY DAUGHTER PURCHASED THE HOUSE FROM THE ESTATE. SHE IS A SINGLE MOM AS WELL. THIS IS NOT FAIR. THIS NEED TO BE CHANGED!!!!!
I purchase my fathers home after he died. I purchased it from the estate attorney for fair market value.
The house needs many repairs and I didn't know I was going to get wronged by our government. by denying me the first time home owner credit.
Yeah bail-out the banks and rich gov cronies, but to deny this credit to 99% of the honest people in America is just plain wrong.
I've been disqualified from receiving the first time homebuyers credit because in 2007 I married a long time homeowner. I never had any ownership stake in her house. She would qualify for the move up credit, except for, she married me, and I don’t. The real kicker too, our new home only cost $62,750 so with either the first time or move up credit we should have received $6,275 which is less than the maximum move up credit.
The new house is in my name only even and I’ve still been told that I can’t even qualify for the ½ credit if me filed our taxes separately.
I purchased my home from my dad, cause he lost his job and he had no way to pay for the mortgage.
I was trying to help my dad and also buy my first house but i didnt realize i was making a bad deal. Thanks Congress
My wife and I purchased a house from her parents. We spent all of our savings to purchase the house and were expecting to receive an $8000 tax credit to help fix up the house. It is unfortunate that we are being penalized because others may abuse this credit. This was a legitimate purchase as we plan to stay in the house with our two kids indefinitely.
My brother purchased my mother's home after she passed way. It was in her estate and would be very difficult to sell in the current Michigan housing market. He is single and this is first home ever. We weren't aware of this restriction, nor were we advised of the issue by the estate attorney or the by the title insurance company. I know that ignorance of the law is no excuse, but it appears that this restriction was not well publicized and has punished well intentioned people in their trying to do something right. At the very least I would think that a purchase from an estate should be treated differently than buying from a currently living relative.
I was also disqualified of this tax credit since I bought out right through a mortgage company from my mother. We did everything by the book. We withdrew money from the husbands 401 K to make the down payment' thinking we would replace it with the credit money. We payed fair market price for the home. We did everything you are supposed to do when buying a home. We now have a big fat mortgage like everyone else. However, since the seller was my mother I am not eligible for the credit. This is unfair and very discriminating against honest hard working people. We should have the right to appeal this decision and prove we bought our homes legally and fairly
My wife and I purchased our home from her mother. We were denied the tax credit due to that simple fact. We are also hardworking, tax paying Americans and did not purchase the home by any deceptive means. In fact, my wife's mother did not technically own the house, Wells Fargo did. We believe this decision is unfair and we feel cheated by our government.
My spouse and I just purchased our new home this year as first time home buyers. We worked very hard to get where we are at today. Even though we purchased the home from a close relative we still went through the entire process. We weren't given a break on the price of the home. It's disappointing when two Veterans, who served their country, buy a first home and cannot claim a tax credit because of stipulations. If the stipulation is to weed out "sweetheart" deals then do something else to weed it out! Don't take something away without just cause!
i feel that this is completely unfair. my husband and i owe 100,000 to a bank, over a 30 year period. fair and square! we are hardworking people who pay our taxes. we have not been 'hooked up' in any way. i feel like it is an honorable thing to purchase a house (through a mortgage) previously owned by a relative. people in our category especially deserve this money because fixing up the 'old family estate' can be pricey. so we get punished for trying to preserve our roots and keep something going. i am extremely disappointed in our government for cheating us out of this. please consider this petition!
I too think this is unfair discrimination. To exclude all people who are relatives because some may take advantage is patently unfair to those who bought the home for reasons other than to exploit the system.
I was also disqualified of this tax credit since I bought out right through a mortgage company from my mother. No one told me that I wasn't able to get it until months after signing for my house. My tax guy and the mortgage company both said I was getting it. I was only 19 years old when I bought my house and was expecting the $8000 first time home buyers tax credit. I am also a tax payer, and this is how we are treated for doing our part for our country?
We were informed today that we have to pay back our money because the house we bough was my grandfather's before he passed away. It is a very old house and the money was immediately put into repairs so that we could move into it. We are a hard working, tax paying couple and it is unbelievable that we have to pay this back!!
I was so excited to purchase my 1st home ever and for it to be the family homestead was that much more wonderful, I purchased my family home from relatives upon the death of my grandmother. I went through the same process that you would go through on any other home, the appraisal, the inspection, the contract, etc. it was all completely legal and binding, now I am told I am not able to receive the 1st time buyers credit because my father was listed as an owner upon my grandmother's death? What a crock! Nothing was done "under the table" it is all traceable and legal now I get screwed out of the money to help with things that still need to be done to the home. Thank you US Government for yet again showing the world your best side!
My fiance at the time and myself purchased a house from my parents for full appraisel amount. Waited nine months for them to notice that my last name is the same as my fathers. What a joke. Thanks United states government, for screwing of a 22 and 24 year old tax payer that play by the rules.
i purchased my home from my parents for 388,000.00 which was the exact amount the bank appraised it for. I accrued all the same closing costs associated with purchasing a home as anyone else and was still unfairly denied this tax credit
I purchased my first home from my parents estate, who both died in 2009. IRS now says I'm not eligible because I inherited the home! I did NOT inherit this house, I bought it off my 5 siblings for $85000!!!
I purchased my home from my stepfather and was denied the tax credit. During the time I purchased the home I looked on the IRS web page under FAQ, and some asked if you could buy from a step parent and still qualify; their answer was YES. I was still denied.
this is way unfair and not right. i paid full price for this house from my dad and nobody told me that i would not get this credit at the time of purchase. i looked on the irs web site and could not find anything.
I agree. I went through the same process and I am paying the same fees any other person is. This is really unfair, there could be a stipulation added or we could atleast have the option of it being a loan, it is no different than anyone else buying a house.
This tax credit is a rip-off! When I met my wife she owned a house but lost it due to foreclosure. We married after a year or so and I bought a house in my name. The house was built in 1885 and needs help, we've poured every spare penny into this place to make it liveable. We were waiting on the tax credit to get a new roof and update the old electrical, but guess what, no money! The IRS told me that because my wife owned a house that I couldn't get the money! I was furious, and I still am! This house is in my name alone but they say, " That doesn't matter to us! " Just goes to show you how our government screws us every chance they get! They got the housing market back up a little by promising this and then take it out from under you!
This is rediculous! These people have paid the same costs any homeowner would pay whether it's a relative or not. Isn't this what our economy needs? $$ to go back into the system? What a rip off and how misleading!
It is unfair that law abiding tax paying citizen like myself is instantly discriminated against just because some people cheat the system. Just because a house was bought from a relative doesn't mean that there are underhanded deals going on.
I am a first-time homebuyer who was initially told by my mortgage company that I would be eligible for the $8,000 tax credit being offered under the 2009 First-Time Homebuyer Credit Program. However, on Monday, April 5, 2010, I was notified by my accountant that I did not qualify for this credit because I am a relative, purchasing my home from my father's estate in May of 2009. Why was this stipulation not made clear to me or even mentioned when I was thinking about purchasing this home? My mortgage company stated (when I directly asked) that I was definitely eligible for this credit. This information is not readily or easily available on the IRS website or stated in any of the television ads.
My father passed away on January 2, 2009 after a battle with cancer. This residence was my homeplace growing up, a home that my father built from paycheck to paycheck back in the 1950's. I have resided in this home for the past twelve years and am happy to have made it my own, buying out two beneficiaries and having two legitimate appraisals done by separate independents. I, furthermore, purchased this property at market value.
It is my feeling that had I purchased any other home besides this one, I would qualify for this benefit; yet, I am being penalized for wanting to keep a family home in the family. In light of that fact alone, I believe this tax credit plan to be unfair, unjust, and inequitable.
Since I've taken possession of this property last May, I've done countless home improvements and upgrades and am still in the process of improving/upgrading as time and money permit. I think it's important to mention that I have done 99% of these home projects completely on my own with no outside assistance or help from others. If I were to receive this tax credit that was originally explained to me that I was entitled to, I would continue improving/upgrading my home, thus putting this money right back into the economy by appreciating my home's value and adding to the aesthetics of my community.
In reviewing the IRS Publication 544, Chapter 2 and Form 5405 Instructions, I find the noted stipulations to be extremely misleading and vague. And further, outside of the direction/guidance of an accountant or tax attorney, this information is not easily obtained by the individual common person.
This is a totally bogus stipulation. I understand the premise is to stop people from getting 'sweetheart' deals from relatives and then taking advantage of the tax credit, but what about the people that paid full value for their homes. This stipulation was not well publicized enough and in this case Congress has fooled a lot of people into buying homes. Some homes were even purchased with the understanding that the $8000 would be received to complete the terms of a contract with the Mortgage company, SO NOT EVEN MORTGAGE ORIGINATORS knew about it. Come On. The stipulation should be if the the value of the house is NO WHERE NEAR the purchase price; not whether the seller happens to be a relative. Thats an assumption that all families are trying to get over on the government. But what about the tax-paying, law abiding families that love this country. This was a decent idea with inexplicably horrible execution.
We waited for a year on the USDA waiting list for a 502 direct loan. We finally got it and we bought the house that I grew up in, we had been renting it for 2 years and my parents bought a brand new house. We paid appraised and market value for this house. We are tax paying citizens that have got screwed by this ridiculous stipulation about buying from a relative. I understand some were abusing it, but what about us the FIRST TIME HOME BUYERS that worked so hard to make sure to buy in time for this tax credit only to find out after buying it we could not get it because we bought from a relative. The requirements could be changed to make sure people are buying the home at market value and not for $1 to gain this credit.
I'm very unhappy about this! I bought my parents home to keep it in the family. I'm the 4th generation to own it. Bought it fair and square. Actually think i over paid for it but I wanted it. Then I find out that I can't get the credit. It's totally unfair!
Same thing happened to us, my husband & I purchased home from my mother & stepfather at fair market value only to discover that we do not qualify for credit. We try to live the american dream and be homeowners only to be penalized.
Very deceptive - and why aren't banks telling people this! The bank knows from whom the property is being purchased, so they should inform potential buyers of this disqualifying factor before they go any further into the home purchase. If the buyer is paying a fair market price, it should not matter who they are buying from!
Devastated by this discovery :( Pumped all of my savings into home improvements, thinking I would have money to pump back in. Hope that something comes of this. What would happen if you submitted the form anyway, and answered "no" to the relative question. In my case, half of the home was owned by my wife's father and half owned by my wife's stepmother, so I wouldn't necessarily be answering the question dishonestly. Any insight?
I did my taxes today and found that I am not elligible for the tax credit because I bought a home from my father. I am a first time home buyer and bought a home that was only a few years old. Needless to say it wasn't cheap. It should've clearly stated in the commercials that people buying homes from family members are not elligible. I was going to use some of this money for a down payment on a vehicle, but oh well. Sorry auto industry.
I also purchased a home from my father and I find it very unfair. My dollar is worth the same as any other citizen. I purchased my house under an fha loan and paid the maximum amount i possibly could finance according to my appraisal!!! I think that if the goverment did this so fraud would not occur thats fine, but there should have been put in place certain steps, paperwork, or sometype of system to make sure that each purchase was not just done to receive money for nothing, even though closing costs would make it ridiculous to fraudulantly receive the money. Not much would be left over. Regaurdless it should have been the goverments responsibilty to guarantee me my money. The family stipulation is the only one that stops me from receiving my fair share. Thank you for your time and a big thanks to whoever started this petition.
PLEASE change this unfair rule. Does anyone know. Can you just say NO you didnt buy from relative. and just send the HUD-1 to see if they give you the money. Would they give it and them come back after it?
Just doesn't make any sense. We had know idea this was the case until we started doing our 2009 taxes and preparing our first time home buyer tax credit forms. Shocking!
I also think this is unfair. It's discrimination really simply because they do not want to have to police this. We purchased a house from my parents at market value, with a verifiable loan and proper paperwork, only to learn we do not qualify. What a way to treat a small portion of us that need this, especially something that is easily checked.
This is the IRS's thinly veiled attempt to avoid the necessary paperwork to follow up on the "relative cases".
My husband and I purchased our home from my parents - at fair market value (as determined by our credit union's independent appraiser), and we have taken out a first mortgage from a commercial lending institution. We paid the full amount any other party would have paid. No hanky-panky here. My parents purchased another home - they will receive their credit. However since we are not receiving the credit, we will not be able to reinvest into our home, our local economy (taxes and local businesses), and American products or labor (we were using part of that to purchase a GM vehicle, but that needs to be delayed, possibly laying off our GM-employed neighbors).
I am being discriminated based on a relationship to the previous owner and the lack of effort on the IRS. They are making assumptions that all related buyers are abusing the system and it is unjust.
Please visit my blog and share your story with me, too. I am attempting to petition my local congressman and state attorney general, but I'd love to hear your feedback.
http://homebuyerinjustice.blogspot.com/
homebuyerinjustice (dot) blogspot (dot) com.
We made a legitimate purchase, now I want to be treated as a legitimate buyer.
I bought my parents house from them after they moved. No special treatment, i took out a mortgage just like everyone else. There was nothing shady. I should not be punished because of those who are doing something wrong. Also,I do not know if this is correct but i heard that this stipulation was put in place in november '09...well, i closed on my house in august '09. If i had any idea that this would happen when i was deciding on buying my house or the other house that i really liked as well, i guarantee that i my decision would be different.
We were in the position to help our son out by purchasing a bank repo that he couldn't get a loan on due to some inspection issues. We spent months renovating the home so that it would qualify for a loan & sold it to him for what we paid for it & plus the renovations. He was planning on replacing the roof, gutters & downspouts when he received the first time homeowners tax credit. We didn't know about the "relative rule until a friend of ours who works for a well known tax office told us. All of the bank & real estate people were also unaware of it. We are blessed to be able to help our children who are just starting out in life but we're not rich by any means. Maybe our son shouldn't qualify for the tax break since he got help from us but I think it's REALLY unfair for the first time homebuyer who purchases a property from a relative at appraised value & doesn't qualify. Of course, there are lots of people who know how to work the system who are being dishonest to get the tax credit. For those of us that are playing by the rules, we can only hope that they get heavy fines & penalties when (& if) they get caught.
I am in the same position as many listed here. I purchased my first home from the estate of my grandfather, an appraisal was done and no special consideration was given to me as a family member. I paid fair market price and have the loan documents and appraisal to back me up. I did not learn I wasn't eligible until my account called to tell me when filing my taxes. My mortgage broker and closing agent never mentioned it to me. I find this rule completely ridiculous and it should be removed. I pay taxes like everyone else and I have the documents to back up my purchase, I shouldn't be excluded based on who owned my home before me.
If anyone has had success battling this rule please email me and let me know how. biscuit141@comcast.net
I am in the same position as many listed here. I purchased my first home from the estate of my grandfather, an appraisal was done and no special consideration was given to me as a family member. I paid fair market price and have the loan documents and appraisal to back me up. I did not learn I wasn't eligible until my account called to tell me when filing my taxes. My mortgage broker and closing agent never mentioned it to me. I find this rule completely ridiculous and it should be removed. I pay taxes like everyone else and I have the documents to back up my purchase, I shouldn't be excluded based on who owned my home before me.
If anyone has had success battling this rule please email me and let me know how. biscuit141@comcast.net
I think if the property was purchased from a relative at fair market value and no special considerations were given because the purchaser was a relative then they should be eligible for the first time home buyer tax credit. It is totally unfair that a homebuyer can't take advantage of the tax credit when they purchased the home at the same price and under the same terms as any other person would have purchased the home.
I too am one of the very many that have fallen victim to this unfair stipulation. My husband and I rented our home for 4 yrs from my grandmother and purchased our home closing on 11/30/09. Same story as the rest, our loan officer had no clue of this stipulation and even at the closing table with my grandmother, loan officer and closing attorney we all discussed openly the $8000.00 tax credtit we would receive. Not until we went to file our taxes did we find out that we didn't qualify. We paid the full "appraied" value for our home,same as anyone else would have paid (probably more). We recieved no break due to purchasing from a relative. When watching the Presidents State of the Union Address a month or so ago, he mentioned this tax credit and how the tax credit would help the taxpayers then help drive the economy in home improvement once these homes were purchased. He also spoke on the environment and making homes more energy efficient. REALLY!!! All of which my husband and I planned to do with our tax credit!! We now are still dealing with the 50+ yr old windows that would have been replaced, giving a company business, "helping drive the economy" and making our home more "energy efficient". We worked incredibly hard to get to this point to purchase our first home. I to think this should be changed or modified and made retroacive!!
Regardless of whether or not I am interested in purchasing a home from a relative I think in todays market it is incrediably difficult to purchase a home and many people are forced to buy off family members who are willing to owner finance. This stipulation in the tax credit exempts these people because they are purchasing from a relative. It is unfair and in essence harming the economy. I understand that their are people who will minipulate the system but I also know that the IRS has other stipulations in place to help prevent this. I believe that this "relative" stipulation should have been removed from the beginning!
Unfair Stipulation in the First-Time Home Buyer Tax Credit
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Some recent comments: these messages are published with permission of the signer.
The house needs many repairs and I didn't know I was going to get wronged by our government. by denying me the first time home owner credit.
Yeah bail-out the banks and rich gov cronies, but to deny this credit to 99% of the honest people in America is just plain wrong.
The new house is in my name only even and I’ve still been told that I can’t even qualify for the ½ credit if me filed our taxes separately.
I was trying to help my dad and also buy my first house but i didnt realize i was making a bad deal. Thanks Congress
My father passed away on January 2, 2009 after a battle with cancer. This residence was my homeplace growing up, a home that my father built from paycheck to paycheck back in the 1950's. I have resided in this home for the past twelve years and am happy to have made it my own, buying out two beneficiaries and having two legitimate appraisals done by separate independents. I, furthermore, purchased this property at market value.
It is my feeling that had I purchased any other home besides this one, I would qualify for this benefit; yet, I am being penalized for wanting to keep a family home in the family. In light of that fact alone, I believe this tax credit plan to be unfair, unjust, and inequitable.
Since I've taken possession of this property last May, I've done countless home improvements and upgrades and am still in the process of improving/upgrading as time and money permit. I think it's important to mention that I have done 99% of these home projects completely on my own with no outside assistance or help from others. If I were to receive this tax credit that was originally explained to me that I was entitled to, I would continue improving/upgrading my home, thus putting this money right back into the economy by appreciating my home's value and adding to the aesthetics of my community.
In reviewing the IRS Publication 544, Chapter 2 and Form 5405 Instructions, I find the noted stipulations to be extremely misleading and vague. And further, outside of the direction/guidance of an accountant or tax attorney, this information is not easily obtained by the individual common person.
Sincerely, Daniel Martins
My husband and I purchased our home from my parents - at fair market value (as determined by our credit union's independent appraiser), and we have taken out a first mortgage from a commercial lending institution. We paid the full amount any other party would have paid. No hanky-panky here. My parents purchased another home - they will receive their credit. However since we are not receiving the credit, we will not be able to reinvest into our home, our local economy (taxes and local businesses), and American products or labor (we were using part of that to purchase a GM vehicle, but that needs to be delayed, possibly laying off our GM-employed neighbors).
I am being discriminated based on a relationship to the previous owner and the lack of effort on the IRS. They are making assumptions that all related buyers are abusing the system and it is unjust.
Please visit my blog and share your story with me, too. I am attempting to petition my local congressman and state attorney general, but I'd love to hear your feedback.
http://homebuyerinjustice.blogspot.com/
homebuyerinjustice (dot) blogspot (dot) com.
We made a legitimate purchase, now I want to be treated as a legitimate buyer.
If anyone has had success battling this rule please email me and let me know how. biscuit141@comcast.net
If anyone has had success battling this rule please email me and let me know how. biscuit141@comcast.net
Sign the Petition