The Federal Tax Credits Blog

Question: I have a question about amending my 2009 tax return so I can receive the $8000 tax credit?

First of all I want to know if this is a good idea? Also, would it be smart/feasable to take out a small loan to use as my down payment and cover closing costs, and then pay off that loan when I receive the housing credit back? Do you actually have to close on the house before you can amend the taxes for the housing credit? Thanks

Answer: You do not have to CLOSE on the mortgage to be able to amend. You just have to have a contract to buy before May 31 and the home closed on by July1. No it is not a good idea to get a loan for anything you want to pay back with a tax refund because who knows if you will actually get it or not? Then youre just stuck with another bill. Never consider ANYTHING GUARANTEED when dealing with the IRS

PS – there is a long time homebuyers credit this year for people who have owned a home in the past 5 years and lived in as their primary residence for at least the last 3 years and kept up with the payments. However, to qualify you must be 19 years of age, live in the US and cannot have purchased it from a relative, it also has to have been purchased AFTER November 6, 2009. You receive 10% of the purchase price UP TO $6500 credit on the new home purchase.

You fill out the same 5405 but markthe “long time resident” box on page 1 part 3 of the 5405.

I usually file the initial return electronically WITHOUT the 5405 to get my clients back part of the refund in a timely manner and then go back and amend WITH the 5405 for the rest of the credit. That way my clients are not waiting 6 months for any money to reach them. They get part now and part later.

Home Energy Tax Credit not for everyone

Some homeowners will not qualify The 30% Home Energy Tax Credit covers a number of energy efficient items around the home.

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