I signed a prenuptial settlement with my now ex-husband that I’d not declare possession of his home he purchased earlier to the wedding. I didn’t obtain any funds regarding the home once 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 residence purchasers’ tax credit score if I occupied the ‘marital’ residence throughout our marriage however had no possession of the “marital” residence.
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 residence throughout the tax yr.
A qualifying house is just about any residence buy, together with a home, rental or perhaps a cell residence. The caveat is that you have to intend to occupy the house by no later than one yr after you purchase it. The house should even be registered in your title (or that of your partner or frequent regulation accomplice, if relevant) in accordance with the relevant land registry system. The house have to be positioned in Canada.
I feel the place you’ll 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 accomplice) acquired a qualifying residence.
- You didn’t reside in one other residence owned by you (or your partner or common-law accomplice) within the yr of acquisition or in any of the 4 previous years (first-time residence purchaser).
Regardless that your husband is now your ex-spouse, you probably did reside in a house owned by him throughout the earlier 4 years. This may disqualify you from claiming the house patrons’ quantity, regardless of the pre-nuptial settlement and the shortage of direct possession or monetary profit.
For what it’s value, the $5,000 credit score will not be 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.