Can they deny my 2014 tax credit? 2 Answers as of April 16, 2015

I had a bankruptcy discharged in October 2010. I had the foreclosure sale on my old house in February 2012. Did I lose ownership rights after the bankruptcy or after the foreclosure? I bought a house in December 2014 and the IRS is denying my 2014 tax credit saying that I have owned a house in the 3 years before the date of purchase because the mortgage company sent them a statement from 2012.

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Ronald K. Nims LLC | Ronald K. Nims
The first time home buyer credit expired in 2010. There was no credit to claim in 2014. Bankruptcy does not transfer ownership of the house, bankruptcy discharges your personal obligation on the loan but doesn't affect the lien against the property. Only the foreclosure or a deed-in-lieu transfers ownership.
Answer Applies to: Ohio
Replied: 4/16/2015
The Schreiber Law Firm
The Schreiber Law Firm | Jeffrey D. Schreiber
The bankruptcy discharged your obligation to pay the note (payments). Bankruptcy does not affect liens, nor do you lose the house in bankruptcy unless sold by the bankruptcy trustee while the bankruptcy is open. After bankruptcy, you still owned the house. The lender forecloses on the lien to either sell it at foreclosure to a third party, or if there is no buyer, the bank takes it back and at foreclosure sale you lose ownership. From the facts you present, you lost the house in February 2012 when the lender foreclosed.
Answer Applies to: California
Replied: 4/16/2015
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