Help With First Time Buyer $8000 Tax Credit Filing

The IRS is auditing all claims for the First Time Buyer Homebuyer Tax Credit.

This week, I've gotten several calls from buyers who've had their claim for the First Time Buyer $8000 Tax Credit denied due to insufficient paperwork. The IRS has been auditing all claims due to heavy amounts of fraudulent returns that have been filed to try and claim a credit where none is due.

Everyone that has called were due the Tax Credit but had improperly filed their supporting paperwork. None had used a tax preparer or accountant.

According to the IRS website the qualifications and proper procedure are as follows:

How to Claim the Credit

2009 or 2010 Tax Return

For qualifying purchases made in 2010, you have the option of claiming the credit on either your 2010 or 2009 return. For qualifying purchases made in 2009, you have the option of claiming the credit on either your 2009 or 2008 return. If your return for a particular year has already been filed, use Form1040X to amend your return for that year, along with Form 5405, First-Time Homebuyer Credit and Repayment of the Credit (see the instructions for help with the form), and a properly executed copy of a settlement statement used to complete the purchase.

• Purchasers of conventional homes should include a copy of Form HUD-1, Settlement Statement, or other settlement statement, showing all parties' names, property address, sales price and date of purchase.
• Purchasers of mobile homes who are unable to get a settlement statement should include a copy of the executed retail sales contract showing all parties' names, property address, purchase price and date of purchase.
• Purchasers of newly constructed homes where a settlement statement is not available should include a copy of the certificate of occupancy showing the owner’s name, property address and date of the certificate.

For those who thought they might try and get away with filing a fraudulent claim, lookout. Claims are being investigated jointly by the FBI, IRS, HUD, The United State Attorney's Office and State law enforcement agencies. 14 people in Massachusetts were recently charged and face up to 5 years in prision and a $250,000 fine.