For those of you who can’t get through our 20-page Special Report on the Marriage Penalty in the Home Buyer Tax Credit, or don’t have time to read through all our posts in the matter, we’ve finally put together a video that explains everything you need to know about the marriage penalty. Please take a look.
UPDATE April 13, 2009: The video references a “Fourth Type” of Marriage Penalty questioning whether a married couple would qualify for the Home Buyer Tax Credit in situations where the couple has lived in a home for the requisite five-consecutive-years-out-of-eight period but only one spouse is on the title to the property. The IRS has now confirmed for us that in those situations, ownership by one spouse would be imputed to the other spouse, so those couples would indeed be eligible for the Home Buyer Tax Credit as long-time homeowners (assuming they otherwise qualify).
THESE MARRIAGE PENALTIES ARE SHAMEFUL? I’m newly married, my husband and I are purchasing a new home together. We had separate, long-term residences. So, we are not eligible for the credit. What nonsense! Had we not married & shacked up, we would have qualified separately. Does anyone know if he were to purchase the home and mortgage in his name only, would he qualify for the credit? Or still screwed becasue of the marriage test on both of us?
Hi @Sharon, thanks for posting. We agree that this is an unfortunate mistake that Congress made in expanding the tax credit. With regard to your last question about whether he could buy it in his own name — it wouldn’t matter, the fact that he’s married means he and you both need to qualify for the same credit, even if only one of you is buying the property.
One thing we can do is to vote in open congress website to show that we support this bill.
http://www.opencongress.org/bill/111-h4701/actions_votes
Great idea!