Buying a home after divorce
MoneySense
It pays to know. Helping Canadians learn about personal finance and make better financial decisions. Visit us daily for
I have a question for you regarding the first-time home buyers’ tax credit.
I signed a prenuptial agreement with my now ex-husband that I would not claim ownership of his house he bought previous to the marriage. I did not receive any funds relating to the house when I left.?
When we divorced, I needed to find a house. I purchased a home for myself, and I am wondering if I can apply for the first-time home buyers’?tax credit if I occupied the ‘marital’ home during our marriage but had no ownership of the “marital” home.
—Shawna
How a divorce can affect buying a house, especially for the first-time buyer
The tax credit you are referring to, Shawna, is the home buyers’ amount (line 31270 of your tax return). An eligible taxpayer can claim $5,000 if they purchased a qualifying home during the tax year.?
领英推荐
A qualifying home is pretty much any home purchase, including a house, condo or even a mobile home. The caveat is that you must intend to occupy the home by no later than one year after you acquire it. The home must also be registered in your name (or that of your spouse or common law partner, if applicable) in accordance with the applicable land registry system. The home must be located in Canada.?
I think where you are going to run into a roadblock, Shawna, is that your ex-husband’s ownership of a home will disqualify you. A taxpayer can only claim the home buyers’ amount if both of these conditions are met:
Even though your husband is now your ex-spouse, you did live in a home owned by him during the previous four years. This will disqualify you from claiming the home buyers’ amount, despite the pre-nuptial agreement and the lack of direct ownership or financial benefit.?
For what it is worth, the $5,000 credit is not all it is cracked up to be. You only get a tax reduction or refund of 15% of this $5,000 credit, so $750.?
Read the full article at moneysense.ca.