After reading up on the First-Time Homebuyer Tax Credit guidelines, I felt I could safely claim the credit since we purchased our fifth wheel during the appropriate time frame and it is our sole residence. It is not motorized (motorhomes do not qualify), and we do have a permanent homebase and only travel a couple of months a year. Seemed like our situation fit the bill.
Based on the price of our used rig, I claimed just over $1700 for the credit and sent in my return with all the requested documentation at the end of February. Then I waited. And waited. Then I waited some more.
It took the IRS six weeks just to acknowledge receipt of my return. Shortly after that, they updated the “Where’s My Refund” site to indicate I’d have my refund at the end of April. Well, that date came and went, and still no money. I logged back into the site to find that my claim was “processing,” whatever that meant.
I went ahead and called in. Keep in mind, this is two months after initially sending in the return. I was told that my return, like many who claimed the homebuyer credit, had been kicked to the Error Correction Department and that I would be receiving a letter requesting additional documentation.
I waited a couple of weeks, received the letter, and then promptly sent back the requested documentation. The documentation, incidentally, was the SAME EXACT paperwork I sent with my initial return. I called and asked about this, and I was told that it was common for them to ask for the same paperwork again. I was also told that the IRS was really backed up reviewing the homebuyer credit claims and that it would take another 4-6 weeks for Error Correction to review my return.
ARGH! I had really been counting on that money for our trip by mid June, but it wasn’t looking promising. I made a point of checking the site every week to see if there was any update. By the end of May, the information on my return disappeared from the website altogether. They had no record of it at all, so I called again.
Turns out, the return had finally left Error Correction, but the customer service person I spoke with had no way of telling what happened, whether my refund amount had been changed, but she did say I should be seeing my refund in the next month or so along with a letter indicating the IRS’ decision regarding the return.
At this point, I’d just given up hope ever seeing the money before we got back in August, but just last week at the end of the second week of our trip and really just in the nick of time, the refund showed up in my bank account, less the $1700+ New Homebuyer’s Tax Credit. Grrr! All that rigmarole to not get the credit anyway. Had I known it was such a challenge, I would have not claimed the credit at all and gotten my refund three months ago!
I suspect the reason I was denied the credit has to do with the language in the code that states the trailer must be “attached to land.” After first hearing about my refund being kicked to Error Correction, I did more research about this credit, and some sites said “attached to land” stipulates that the axles and wheels must be removed and the home must be either anchored to the ground or placed on a foundation similar to a mobile home. That’s not the case with our rig. We sit on our tires. I suppose I won’t know for sure until I get that letter in the mail.
Here’s the most interesting part of this whole saga: while I was denied the tax credit, I was allowed to deduct mortgage interest! What the heck? Apparently, RVs can be counted as residences ONLY when it suits the IRS. Good to know.
I’m never, ever filing a paper claim again if I can avoid it. This was the first time I’d done so in years, and boy was I sorry.
Tags: First-Time Homebuyer Tax Credit, fulltiming, IRS, rv, taxes
