My wife and I purchased our first home together in October of 2009 from my mother-in-law. We were so excited to get this home not only because it would be ours, but we would receive $8,000 tax credit from Uncle Sam when we filed our return.

Today I decided I should look into how we were suppose to file in order to get this credit. According to the IRS website I needed to file a Form 5405. I opened the form online and began to read through it. When I got to line E of the form I felt the blood drain from my face and then quickly return from severe anger and rage.

Line E of the IRS Form 5405 reads:
Did you purchase the home from a related person or a person related to your spouse (see instructions)?
X Yes (bought from mom-in-law) - You cannot claim the credit. Do not file form 5405.

What?!?!? What the heck does buying a home from a relative have to do with anything? So they're telling me that because I bought a home from my mother-in-law I'm ineligible to get the credit? Thanks a lot Obama and staff. Chalk me up as another American that got rear ended by the fine print.

This post does not do justice to how ticked off I am about this. I'm really holding my tongue on this one. (read: I have temporary Tourette's Syndrome while typing this)

 

Don't worry. You are one step closer to getting "Free" healthcare!!!

 

What's the big deal? Just follow in our leaders footsteps and do what Obama would do... LIE!

 

Ughh. The thought makes me want to check into a "special" hospital.

Don't think I haven't thought of that!

 

They *think* (really they dont...) that you would get it cheaper being a relative....

 

I totally agree with them "not thinking". I know they never think things through.

I figure that would be a reason (getting it cheaper), but spend money with a relative or a complete stranger money is still changing hands and taxes are being paid. I didn't get an awesome deal, I just got the rock bottom my mother-in-law could take. A good negotiator could have got the same deal.

 

I'm still waiting for the "I've owned several homes and paid a schload of taxes on all of them so all the fat cat politicians can dine very well" tax credit.

 

I could see it as a measure to prevent everyone from buying their brother's house and leaving the arrangements as they are to get a free $8000. For example, if my house was paid off and my brother's house was paid off we could sell our houses to eachother for the same amount (no capital gains or anything) and get a free $8,000. There are filing fees and title fees but they are less than $8k in MD and I believe dirt cheap in NC, other states im not sure. The stipulation did give you the shaft tho.