IRS Sets New Rules for Tax Credit
The Daily Real Estate News reported that the Internal Revenue Service (IRS) has published new guidelines for eligibility for the home buyer credit when there are co-borrowers purchasing the home.
When a parent of an adult child co-signs for the mortgage and both names appear on the note, the IRS says that under some circumstances, the first-time home buyer can qualify for the whole amount. The parent does not qualify for claiming the tax credit, however, if the child has not owned a home in the last three years and qualifies based on income, he or she can claim the whole $8,000 credit.
When an unmarried couple co-purchases a home and only one of them is eligible for the credit, he or she can claim the full $8,000 credit.
Source: The Weekly Real Estate News (12/11/2009)