Hi, I'm in H1b. In 2008 tax return , I claimed my Indian mortgage interest.
I bought a home in US in 2009 and claimed first time home buyer credit. But IRS said I'm ineligible to get my first time home buyer credit since last year I claimed home mortgage interest detection. Can I say IRS , the home that I bought in US is my primary residence and I'm eligible for the tax credit. Thanks.

No - the fact that this new home is now your primary residece is immaterial. Prior to November 6, 2009 you had to be a first-time home buyer in order to qualify for the credit, meaning you did not own any other main home for at least the three year period prior. Since you had claimed home mortgage interest in 2008, you clearly were not a first-time buyer. I am assuming that you purchased your US home prior to Nov 8, 2009. For purchases after November 8 2009, the credit was extended to long-time prior home owners as well, meaning people who have lived in the same home for at least the prior 8 years.

Thanks ebaines.. I mortgage int interest I claimed in 2008, is for the home that i bought in India. Not in US.

My first home home purchase in US is on Nov.18-2009.

My tax consultant told me I can claim the interest paid for the home in India. So I did it in 2008. I hope that's right thing to do based on other forum entires.
If it's not right thing to do can I amend the 2008 filing and claim the tax credit for the home.

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Originally Posted by ganeshsarathi

Thanks ebaines.. I mortgage int interest i claimed in 2008, is for the home that i bought in India. Not in US.

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Understood. But I see nothing in the IRS documentation that says foreign-owned property doesn't count as a "principal residence." If the India home was not your principal residience for the last three years, you should qualify. So - was it your principal residence any time in the previous three years?

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Originally Posted by ganeshsarathi

My first home home purchase in US is on Nov.18-2009.

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OK. Since this is after November 6 you would also qualify if you owned your India home for at least 8 years prior, and lived in it as your principal residence for at least 5 consecutive years. Did you?

Quote:

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Originally Posted by ganeshsarathi

My tax consultant told me i can claim the interest paid for the home in India. So i did it in 2008. I hope that's right thing to do based on other forum entires.
If it's not right thing to do can i amend the 2008 filing and claim the tax credit for the home.

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Remember that the requirement has to do with ownership of a principal residence, not whether you claimed a mortgage interest deduction. I recommend that you not revise your 2008 tax return if your motiviation is to sneak in a credit for 2009 that you don't actually qualify for.

Thanks again ebaines for helping me. Yes.. last three years I'm in US and lived in rental properties until I bought the home. I can prove that by showing my lease agreements and my rental payments.

As per your advise , I won't amend the 2008, since the claimed interest is right to do.

First-Time Homebuyer Credit Questions and Answers: Basic Information


Q. Would I be considered a first time homebuyer if I owned a principal residence outside of the United States within the previous three years?

A. Yes. A taxpayer who owned a principal residence outside of the United States within the last three years is not disqualified from taking the credit for a purchase within the United States.

Good! So your apartment in the US was your principal residence at least as far back as November 18, 2006? In your response to the IRS make sure to clarify that the India home was (and is) your second home, and not your main home.

Thanks ebaines. Will update the status at the end of the war if I survive. . Thanks again .

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Mortgages For First Time Buyers

I'm in the same situation. May I ask about the outcome of your war with the IRS?

Hi,

Can you please let me know what all information you provided in Tax File when you claimed mortgage interest in India. Did you get any tax form 1098 form Indian bank ? Or any other information ? EIN ?