The Form
5405, First-Time Homebuyer
Credit and Repayment of the Credit, will be required to claim the first
time home buyer credit this tax season. The agency will begin processing
the new forms in mid-February. In an effort to deter fraud (apart from
visiting untold numbers of EAs already doing this right, notes E@lert),
the agency is also adding documentation requirements.
Along with the Form 5405, all eligible
homebuyers must include with their 2009 tax returns one of the following:
• A copy of the settlement statement
showing all parties’ names and signatures, property address, sales
price, and date of purchase (IRS helpfully notes this is normally the
properly executed Form HUD-1, Settlement Document).
• A copy of the executed retail sales contract—for mobile home purchasers
unable to get a settlement statement—showing all parties’ names
and signatures, property address, purchase price, and date of purchase.
• A copy of the certificate of occupancy—for a newly constructed
home where a settlement statement is not available—showing the owner’s
name, property address, and date of the certificate.
Additionally, those who qualify for
the credit as long-time residents of a single home must document that
they lived in their prior home for a five-consecutive-year period during
the eight years leading up to the purchase of the new home (a separate
list of documents, including property tax records or homeowner’s insurance
records, are suggested as helpful in processing these credit claims).
