Tale of a First-Time Home Buyer: Applying for Our $8,000 Tax Credit

So the next step for us, now that we have moved in, was to claim our $8,000 first-time home buyers tax credit. I expected us the be forced to jump through a series of fiery hoops to get our money, but it wasn’t difficult at all. Rather than waiting until we file our 2010 taxes, I discovered that we could just file an addendum to our 2009 taxes and get the credit this year. All we had to do was fill out an IRS Form 5405 , provide our 2009 tax information, a copy of our purchase agreement, and a copy of our HUD-1 settlement agreement.

The IRS Form 5405 was a simple form that just has a series of questions about the home-buying process such as when the purchase agreement was executed, how much money we made last year, whether we filed jointly or separately, etc. In other words, the information for the form was easy to obtain if you didn’t already know it. Providing our 2009 tax information was easy, I just made a copy of the records that I kept for myself. Done. Obtaining a copy of our purchase agreement was easy as well. I already had it from when we first signed our lives away on the dotted line back in January. The significance of providing the original purchase agreement is to prove that a binding contract was in place to purchase the home before April 30, 2010 to fulfill the criteria to qualify for the tax credit. Obtaining a copy of the HUD-1 was also easy, as that is the document that we signed about a billion times at settlement. I saved a few copies of this as well.

I collected all of this information, stuck it in an envelope, and sent it off to the good ol’ IRS and in 60-90 days we will have our $8,000. America the beautiful, indeed.

Has anyone out there also applied for the tax credit this year? As one of our other bloggers wrote a couple weeks ago, the closing deadline for eligibility for the credit has been extended so that more buyers can take advantage of the credit--so make sure you take advantage of the program if you can.