WASHINGTON, D.C. (Realtor.org) – IRS eligibility guidelines for the homebuyer tax credit when co-borrowers purchase a property have been spelled out.
When a homeowning parent of an adult child co-signs for a mortgage and both names appear on the note, the first-time homebuyer can qualify for the whole amount under some circumstances.
The IRS says the parent doesn’t qualify for any portion of the credit, but if the child hasn’t owned a home during the three years preceding the current purchase and can qualify based on income, he or she can be allocated the entire $8,000 credit.
When unmarried individuals co-purchase a home and only one of them is eligible for the credit, then the full $8,000 can be allocated to the eligible buyer.