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My husband and I are in the process of buying our first home. His Grandfather will co-sign the loan for us and is not a first time home buyer, would my husband and I still qualify for the 8K tax return?

jenkin7 · Posted: Mon Oct 26, 2009 10:27 pm Post subject:

Hi Daysi,

I believe you and your husband should qualify for the first time buyer tax credit. His grandfather may co-sign on the loan, but as long as he is not on the property title he does not have any interest in the property. If you and your husband have the 100% ownership in the property and have not owned a primary residence for the past 3 years, you can claim the full tax credit.

gmakerley · Posted: Tue Oct 27, 2009 8:34 am Post subject:

i agree with that analysis of the situation, and i will also suggest that if you still have questions, that you go to the irs website (irs.gov) or ask your tax advisor, if you have one.

jveenstra · Posted: Tue Oct 27, 2009 3:08 pm Post subject: Tax Credit

You definitely qualify for the tax credit if grandfather cosigns. I think it does not matter if he is on title or not.

The form used to file for the tax credit is IRS Form 5405. Page 2, SPECIFIC INSTRUCTIONS, Section II CREDIT:

If two or more UNMARRIED individuals buy a main home, they can allocate the credit.....a reasonable method is any method that does not allocate all or part of the credit to a co-owner who is not eligible to claim that part of the credit.

To me that means as long as not married, a co-owner does not stop the first time buyer from getting the cerdit entirely.

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