Home Buyers Tax Credit question

[MAGICX2]

We received the Home Buyer Tax credit for our 2009 Tax year when we purchased a home in 5/2009. We were renting at the time. A family member passed away and they offered the home to us at a great cost. We were not planing on building a home for at least 4 years on property that we owned. Our situation has changed and we are ready to build now. We would like to sell the home we are in and have another family member interested.
You are supposed to own and live in the home as your primary residence for 3years or you have to pay back the $8000. A friend of ours told us that there are exceptions to this. If the sale price of the home+closing+improvements minus the $8000 is LESS than what we bought the home for than we don't repay anything. Does anyone have any experience with this?
$107,000+$3200 closing+$5000=$115200
$115200-$8000 tax credit=$107200
$107200-$106900(sale price)= a negative $300

 

[trip]

We received the Home Buyer Tax credit for our 2009 Tax year when we purchased a home in 5/2009. We were renting at the time. A family member passed away and they offered the home to us at a great cost. We were not planing on building a home for at least 4 years on property that we owned. Our situation has changed and we are ready to build now. We would like to sell the home we are in and have another family member interested.
You are supposed to own and live in the home as your primary residence for 3years or you have to pay back the $8000. A friend of ours told us that there are exceptions to this. If the sale price of the home+closing+improvements minus the $8000 is LESS than what we bought the home for than we don't repay anything. Does anyone have any experience with this?
$107,000+$3200 closing+$5000=$115200
$115200-$8000 tax credit=$107200
$107200-$106900(sale price)= a negative $300

I didn't think you could claim this credit if you purchased from a relative.

 

[MAGICX2]

It was a very distant relative, like 4th cousins. And technically, we purchased it from his wife, so we are not "related."

 

[trip]

This might be what you are looking for.

http://www.irs.gov/newsroom/article/0,,id=206293,00.html

Q. When do I have to repay the credit?

A. You repay the full or part of the credit as an additional tax on your tax return when the home stops being your main home during the 36-month period following the date you purchased your home.

You must repay the full credit when:

You sold your main home to a related person or entity
Your home is destroyed, condemned or disposed of under threat of condemnation and you do not purchase or rebuild a replacement home within two years.
You converted the entire home to a rental or business property.
You converted the home to a vacation or second home.
You no longer live in the home for the greater number of nights in a year.


You may have to repay the full or a part of the credit when:

You sold your main home to a non-related person or entity. You repay the amount of the credit up to the amount of your capital gain. Note: when calculating gain or loss on your main home if you received the first-time homebuyer credit, you reduce your basis by the amount of the credit. See Publication 551, Basis of Assets, for more information.
You lost your home in a foreclosure.You must repay the credit only up to the amount of gain. (1/6/11)