Who is first home buyer?

The law defines "first home buyer" as a buyer who has not owned a principal residence during the three-year period prior to the purchase.

For married taxpayers, the law tests the homeownership history of both the home buyer and his/her spouse.

For example, if you have not owned a home in the past three years but your spouse has owned a principal residence, neither you nor your spouse qualifies for the first time home buyer tax credit.

Ownership of a vacation hom e or rental property not used as a principal residence does not disqualify a buyer as a first home buyer.

Tomorrow, I will cover how to claim this tax credit...