Send in a Paper Tax Return to Get Homebuyer Credit
As a tax preparer, I normally file all of my client tax returns electronically. However, for this tax season, for all of my clients that are claiming the homeowner credit, we will need to send in a paper return to the IRS. Many farmers may qualify, either for the first time credit of $8,000 or the long-time ownership credit of $6,500.
To claim the credit, you will need to fill out form 5405. For the first time credit, you will need to attach either of the following to the tax return:
- A copy of your closing statement from the home purchase, or
- If purchasing a mobile home, a copy of the retail sales contract, or
- If building a house, the certificate of occupancy and most likely the bills from the contractor to back up the cost claimed on the form.
If you are claiming the long-time credit (which means you lived in the same house for five consecutive years), you will most likely need to provide five consecutive years of either:
- Home mortgage interest statements,
- Real estate tax records, or
- Homeowners insurance.
The IRS has indicated they will not start processing any of these returns until mid-February and the soonest that any refund checks will be mailed will be around late March.
Remember, if you are claiming the homeowner credit, file your return by mail.
Paul Neiffer is a certified public accountant and business advisor specializing in income taxation, accounting services, and succession planning for farmers and agribusiness processors. Paul is a principal with CliftonLarsonAllen in Walla Walla, Washington, as well as a regular speaker at national conferences and contributor at agweb.com. Raised on a farm in central Washington, he has been immersed in the ag industry his entire life, including the last 30 years professionally. Paul and his wife purchase an 180 acre ranch in 2016 and enjoy keeping it full of animals.
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