First-Time Homebuyer Credit Documentation Requirements

Claiming the First-Time or Long-Time Resident Homebuyer Tax Credit on either your 2009 or 2010 return includes some complex documentation requirements.  The IRS recognizes that the settlement documents can vary from location to location, so they have provided some clarification related to these requirements.

1. Settlement Statement - Purchasers of conventional homes must attach a copy of Form HUD-1 or other properly executed Settlement Statement.

2. Properly Executed Settle Statement - Generally, a properly executed settlement statement shows all parties' names and signatures, property address, sales price and date of purchase.  However, settlement documents, including the Form HUD-1, can vary from one location to another and may not include the signatures of both the buyer and seller.  In areas where signatures are not required on the settlement document, the IRS encourages buyers to sign the settlement statement when filing their tax return -- even in cases where the settlement form does not include a signature line.

3. Retail Sales Contract - Purchasers of mobile homes who are unable to get a settlement statement must attach a copy of the executed retail sales contract showing all parties' names and signatures, property address, purchase price and date of purchase.

4. Certificate of Occupancy - For a newly-constructed home, where a settlement statement is not available, attach a copy of the certificate of occupancy showing the owner’s name, property address and date of the certificate.

5. Long-Time Residents - If you are a long-time resident claiming the credit, the IRS recommends that you also attach documentation covering the five-consecutive-year period such as Form 1098, Mortgage Interest Statement or substitute mortgage interest statements, property tax records or homeowner’s insurance records.

If you have questions related to this credit or the documentation required, please contact this office.

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