Baltimoreans rushed in near-record numbers to buy homes during recent months to qualify for an expiring tax credit. But while many got the homes, some might not get the credit.

Accountants and others are reporting cases of the IRS denying claims for the complicated homebuyer tax credit. And some consumers say tax refunds haven't rolled in as fast as they had hoped. The head of the taxpayer-advocacy arm for the IRS told Congress this spring that the agency spent an average of four months to examine a return with homebuyer credit issues.

"There have been so many questionable claims," says Barbara Weltman, author of J.K. Lasser's 1001 Deductions & Tax Breaks. "This is an area that the IRS is looking very closely at."

Virginia accountant Kimberley VanHuss says she has two cases involving divorced clients whose complex situations resulted in the rejection of their claims for the credit. And she says her colleagues are seeing similar problems.

"The majority of the time, there is some sort of question that gets kicked back or it's being denied," VanHuss says.

So what happens if you're denied? It doesn't have to end there. If you believe that you are entitled to a credit — or any other deduction, for that matter — you have a few options to appeal the IRS decision.

The IRS will send you a letter if it rejects a credit or deduction. You need to respond within 60 days to get assistance from a customer service representative and to have the right to appeal your case later in tax court, the IRS says.

Often with the homebuyer credit, it's simply a matter of providing more documentation, says Weltman.

Initially, homebuyers didn't have to prove they bought a house to get the credit, but Congress changed that late last year after the IRS paid out millions to filers who didn't even purchase homes.

The Taxpayer Advocate Service, the independent group within the IRS, can assist you when you aren't able to resolve a dispute through regular avenues.

Marylanders can reach the local office, in downtown Baltimore, at 410-962-2082. The advocate represents low-income taxpayers before the IRS or in court for little or no money. Go online at taxtoolkit.irs.gov to find out more about the advocate's services and information on the homebuyer credit.

To fight denial of the homebuyer tax credit

Make your case in a letter to the IRS. Submit copies of any documentation that supports your claim. Or, talk directly to an agent by calling the phone number listed in the IRS rejection letter. Most problems are resolved at this point.

If you and the IRS still can't see eye-to-eye, request an appeals conference with your local IRS Appeals Office. You can represent yourself or bring in your return preparer or other tax professional for support.

Still unhappy? Plead your case to the U.S. Tax Court. The proceedings involving sums of up to $50,000 are less formal and taxpayers often represent themselves. If the court rules against you, though, the decision is final.

Sources: IRS, the National Association of Tax Professionals

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