Paul L. Caron
Dean


Thursday, September 9, 2010

TIGTA: 50% of Homebuyers Must Repay Tax Credit

TIGTA The Treasury Inspector General for Tax Administration today released A Comprehensive Strategy Is Being Developed to Identify Individuals With First-Time Homebuyer Credit Repayment Requirements (2010-41-086):

Approximately 1.8 million taxpayers claimed a total of almost $12.5 billion in First-Time Homebuyer Credits in Calendar Year 2009. More than 950,000 taxpayers will be required to repay the Credits because their homes were purchased in 2008. Many more may have to repay the Credits if the homes cease to be the primary residences of the taxpayers within 36 months.

https://taxprof.typepad.com/taxprof_blog/2010/09/tigta-50-error.html

IRS News, Tax | Permalink

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Comments

Of course I would never imply that any of my clients had been sleazes. I can, however, based on my experience prosecuting and defending economic crimes, recognize the sleaze mentality at work. Sleazes blythly disregard the "technicalities" and "fine print" in the eleigibility requirements for something like this, and tell people that they really, really, lived there, but just never got around to changing their driver's license or mailing address because they were too busy. The cynical might suspect that they just never thought anyone would check.

Posted by: Lou Gots | Sep 10, 2010 4:41:29 AM

Another Obama boondoogle. He may now hire more blokes dependent on him for a paycheck to police and harass taxpayers. Not that these don't deserve it

Posted by: walt | Sep 10, 2010 4:49:27 AM

This is odd. The IRS has acknowledged that I have a valid claim for the credit, but is dragging their feet on paying it. I think a lot of people are in the same situation. I don't know of anyone who has received the credit yet - so what's with the talk about "paying it back"?

Posted by: gatorilla | Sep 10, 2010 5:18:39 AM

Like everything else the government does. . you gotta read the fine print if you think you are actually getting a deal. . .

Posted by: Ryan | Sep 10, 2010 5:44:11 AM

Ya didn't really believe Obama and Tax Cheat Geithner, were looking out for 'the little guy' didja?

Posted by: Freddd | Sep 10, 2010 6:12:34 AM

How's that Hope & Fundamental Change workin' out for you?

You can issue regulations that purport to override reality, but in the end reality always seems to get the reg overturned. A free lunch is *never* actually free; there are always conditions to it. Do people never learn? Gods of the Copybook Headings, and all...

Posted by: Joe Blow | Sep 10, 2010 6:54:16 AM

Walt; FWIW, I received my credit within about 2 months of buying my home. But then I bought in 2010, when the rules for the credit were different than in 2008-2009.

Posted by: Troy | Sep 10, 2010 7:04:02 AM

Whaddya mean I don't qualify? It's my first house on that street and I didn't completely move in until 2009.

Posted by: Bob | Sep 10, 2010 7:39:04 AM

My husband and I purchased our home in Feb. 2009, and initially took the $7500 tax credit (loan) that year. However, we amended our tax return when we did our taxes this year so we got the $8000 credit instead, which we won't have to pay back unless we move out of the house before Feb. 2012. Our plan is to move in the Spring of 2012, if the housing market doesn't tank again.

Posted by: Maren | Sep 10, 2010 8:44:24 AM

How did the line appear on the 08 tax form for a credit that wasn't there? Did these folks find an invisible line to put the figures on? And what about the tax credit for home buying that was on the books as far back as 1999 when I used it as credit on my taxes? This doesn't make sense. Lets just take more money from the "rich".
Was the regulation czar looking into this? What is going on? and how long before we can audit the Fed, IRS, and Fannie and Freddie?

Posted by: Terri | Sep 10, 2010 9:08:03 AM

For those of you who are going after Obama or the IRS for this... you're out of your mind! I'm as conservative as they come. I don't like Obama in the slightest, but people need to take responsibility and understand the law before they take action. If you incorrectly got the credit you owe it back, no ifs and or buts about it. If anything this is a step us conservatives should be applauding.

Posted by: Chad | Sep 10, 2010 9:15:08 AM

INCREDIBLE!!!!! In order to claim the $6500 "long time buyer's program", I had to call an Ombudsman and go show volumes of "proof" for my request and prove who I was. I filed not late but in February. I got the money in July. I know many others in the same boat too.

I can't believe the government let that many people slip through . . .Well, on the other hand . . .yes I can.

Posted by: Bill Schreiner | Sep 10, 2010 10:11:42 AM

Just wait until they follow this procedure for cancer screening testing when you have your shiny new Govt Insurance Card.

Posted by: Mike Tanis | Sep 10, 2010 12:47:28 PM

Well, it is a reasonable deal as long as you were planning to buy anyway and are intending to use it as a residence instead of an investment.

The first "credit" was pretty much an interest free loan--why bother? The second one has a recapture provision that's similar to credits for business equipment.

The IRS was pretty much up front with the requirements from the beginning. Just because some people can't read or deliberately defrauded the government is no excuse to whine.

And for what it's worth, I had no significant delay in getting my credit. I got it when I filed my 2009 return. I suspect that was before the government faced up to the revenue shortfalls this year, and is now delaying as long as possible.

Posted by: phred | Sep 10, 2010 2:19:29 PM

Posted by: Maren | Sep 10, 2010 11:44:24 AM


Strange, the WSJ article in the link above does not indicate that the course you took was a valid option for the 2nd credit (2009). Highly misleading, and will scare a lot of people.

Posted by: phred | Sep 10, 2010 2:25:05 PM

We got that credit and had to sumbit paperwork proving the date we bought the house. Maybe it's the IRS that can't read. Those 2008 house buying refunds should have been denied from the start.

Posted by: Pat | Sep 11, 2010 9:22:19 PM