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Regular Contributor
Posts: 126
Registered: ‎03-13-2007
0

Owing the IRS

I had to amend my 2007 a couple of months ago to remove my dependent that I claimed. As a result, I ended up owing about $2000. I have not received the statement from the IRS yet but it is due to be sent on April 13. I am going to file my 2008 taxes on Saturday and it appears I am going to owe for 2008 as well. I want to purchase a house within the next 3-4 months. My question is could I get approved for a home loan while I have an outstanding balance with the IRS?
Frequent Contributor
Posts: 276
Registered: ‎07-22-2008
0

Re: Owing the IRS

My understanding is that any outstanding federal debt (IRS, student loans, child support) will exempt you from any federal mortgage program. However, if you get on a payment plan (I think you have to have made so many payments but I am not sure) then it maybe ok.
Senior Contributor
Posts: 3,299
Registered: ‎04-22-2008
0

Re: Owing the IRS

I think with tax debt you have to have 12 months payments.

 

The 2007 will probably have to be paid.

 

File an extension for 2008 which will roll it back to August.  You will be fine to hold off paying 2008 until after.

Established Contributor
Posts: 703
Registered: ‎03-23-2009
0

Re: Owing the IRS

Even if you file an extension you are supposed to make an estimated tax payment based on what you think you owe.  It only extends when you have to file.

 

If you are eligible for USDA and are a first time homebuyer then contact your local USDA office.  They have a policy on the books that basically states that if the loan will benefit the government because you owe a government debt then it is basically used as a compensating factor in doing the loan if somehow the government will be paid off.  If you are a first time homebuyer and qualify for the tax credit then you could use that as a point in why they should do the loan.  The IRS would receive the payment in full this year if the USDA did this loan for you :smileyhappy:

Goal: 700 by end of January!!! 7/20/09 EQ 605
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Regular Contributor
Posts: 126
Registered: ‎03-13-2007
0

Re: Owing the IRS

Unfortunately I dont live in a rural area.:smileysad:
Frequent Contributor
Posts: 388
Registered: ‎09-09-2008
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Re: Owing the IRS

That's exactly what we're doing. We just signed a contract on a house and are working on the USDA loan. We'll owe about $2k for 2008. We're filing an extension and then will file the taxes and get $6k back after the purchase is complete.
New Contributor
Posts: 71
Registered: ‎02-03-2008
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Re: Owing the IRS

I am doing the same thing as deemac,  I will owe $1,256 for 2008 and we are trying to close by 4/15.  If that does not happen I will request an extenstion and when I file my credit back to me will be $6,744.
Elizabeth
3/23/09 - Eagle Home Morgage pulled a 742 on me?!!! WooHoo!!!!

3/16/09
TU 708
EQ 692
Established Contributor
Posts: 703
Registered: ‎03-23-2009
0

Re: Owing the IRS

That is what I plan to do also once I am able to move forward with loan application.  It only makes sense for the government not to use it to deny the loan but to make it a reason (along with all the other positives on the loan) to proceed with the loan.

 

Check with HUD and see what their policy is.  They may also have the same reasoning on FHA loans.  It is not like you have taxes due from 10 years ago.  It is not uncommon for people to end up owing taxes and working out a payment plan.

Goal: 700 by end of January!!! 7/20/09 EQ 605
6/03/09 EQ 587
5/15/09 Ex 686 TU 653
5/11/09 EQ 628/ TU 639/ EX 656 (81% util.)
5/9/09 EQ 628/TU ?/ Exp ?
3/23/09 EQ 491/ TU 565/ Ex 627
Regular Contributor
Posts: 126
Registered: ‎03-13-2007
0

Re: Owing the IRS

I plan to set up payment arrangements I am just not sure if I should go ahead and pay it of ASAP or start saving for my DP.

Super Contributor
Posts: 6,624
Registered: ‎07-03-2007
0

Re: Owing the IRS

If the lenders gets a clear CAIVRS report you shoulf be fine. You will need to disclose the debt.

 

 

http://www.hud.gov/offices/hsg/sfh/sys/caivrs/caivrs_faq.cfm

 

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