IRS Blocks 10% of Home Buyer Tax Credits

It's pretty clear that a large number of home buyers may not understand how the first-time home buyer tax credit works.

A disturbingly high percentage of filers trying to claim the credit might just be crooks. An IRS audit rejected almost 10% of home buyer tax credits due to incorrect or outright fraudulent claims. Some taxpayers are prison inmates, but that's not unusual, I suppose, as mostly crooks are behind bars. Others involved multiple claims for the same house by different people. Yet others tried to claim the credit for homes that were purchased before the program began.

While nobody I know really loves the IRS, at least the government is doing something to prevent further fraud and is trying to not hand over your tax dollars to those who don't deserve it. We have a big enough federal deficit already.

The good news is President Obama extended the home buyer tax credit from an earlier June 30th closing date to September 30, 2010. This applies only to home buyers who were in contract by April 30th.

More Articles by Elizabeth Weintraub:

• How to Deduct Loan Points
  
• Tips for First-Time Home Buyers
  
• How to Buy a Model Home

Technorati tag: home buyer tax credit

_{At the time of writing, Elizabeth Weintraub, DRE # 00697006, is a Broker-Associate at Lyon Real Estate in Sacramento, California.}