Don't forget that Mark Steber of Jackson Hewitt will be taking your questions about taxes today from noon to 1 p.m. on the blog.
We've had lots of questions lately, mostly about the homebuyer credits. This one came in the other day from Erin:
Q. I fulfill all of the requirements, but the house I'm looking to buy is in my deceased grandmother's estate (she has been deceased for over 4 years). Is this still considered purchasing from a relative?
From The Tax Institute at H&R Block:
As a general rule, the first-time homebuyer credit rules do consider a grandchild and grandparent closely related relatives. However, a taxpayer can qualify for the credit when they purchase home from the estate of a closely related individual as long as the taxpayer is not a beneficiary of the estate. When an individual dies, their property passes into their estate which then becomes the legal owner of the property. The law considers an estate and its beneficiaries to be related to one another. Thus, a taxpayer may not qualify for the credit when they purchase a home from an estate of which they are a beneficiary. The grandson will need to determine if he is a beneficiary of the estate before he can determine his eligibility for the credit. The executor should be able to provide the grandson with that information.