I signed a prenuptial settlement with my now ex-husband that I might not declare possession of his home he purchased earlier to the wedding. I didn’t obtain any funds regarding the home after I left.
Once we divorced, I wanted to discover a home. I bought a house for myself, and I’m questioning if I can apply for the first-time house purchasers’ tax credit score if I occupied the ‘marital’ house throughout our marriage however had no possession of the “marital” house.
—Shawna
How a divorce can have an effect on shopping for a home, particularly for the first-time purchaser
The tax credit score you might be referring to, Shawna, is the house patrons’ quantity (line 31270 of your tax return). An eligible taxpayer can declare $5,000 in the event that they bought a qualifying house in the course of the tax yr.
A qualifying house is just about any house buy, together with a home, apartment or perhaps a cell house. The caveat is that you should intend to occupy the house by no later than one yr after you purchase it. The house should even be registered in your identify (or that of your partner or frequent legislation associate, if relevant) in accordance with the relevant land registry system. The house should be situated in Canada.
I feel the place you will run right into a roadblock, Shawna, is that your ex-husband’s possession of a house will disqualify you. A taxpayer can solely declare the house patrons’ quantity if each of those circumstances are met:
- You (or your partner or common-law associate) acquired a qualifying house.
- You didn’t reside in one other house owned by you (or your partner or common-law associate) within the yr of acquisition or in any of the 4 previous years (first-time house purchaser).
Despite the fact that your husband is now your ex-spouse, you probably did reside in a house owned by him in the course of the earlier 4 years. It will disqualify you from claiming the house patrons’ quantity, regardless of the pre-nuptial settlement and the dearth of direct possession or monetary profit.
For what it’s value, the $5,000 credit score isn’t all it’s cracked as much as be. You solely get a tax discount or refund of 15% of this $5,000 credit score, so $750.
