Facts: Co-owners purchased a home. The first owner qualified as a first-time homebuyer since they had not owned property in the past three years. The second owner qualified as a first-time homebuyer since they had resided in the same residence for at least five consecutive years of the past eight years. The co-owners jointly filed their taxes and claimed the first-time homebuyer credit. The Internal Revenue Service (IRS) determined the co-owners were ineligible for the credit.
Claim: The co-owners sought the first-time homebuyer tax credit, claiming they were eligible since both owners qualified separately as first-time homebuyers under different criteria.
Counterclaim: The IRS claimed the co-owners were ineligible for the tax credit since both co-owners did not qualify as first-time homebuyers under the same criteria.
Holding: A federal tax court held the co-owners were entitled to the first-time homebuyer tax credit since both qualified separately as first-time homebuyers, despite qualifying under different criteria. [Packard v. Commissioner of Internal Revenue (2012) 139 TC 15]
