Get California 3528 A Form

How to Use California 3528 A

Filling out the California 3528 A form is an important step for those involved in the sale of a new home that has never been occupied. Once the form is completed, it must be submitted promptly to ensure eligibility for the associated tax credit. The seller will need to provide accurate information, and the buyer will complete additional sections. Following these steps will help streamline the process and minimize errors.

1. Part I - Seller’s Certification: Start by entering the seller’s name, Federal Employer Identification Number (FEIN) or California Corporation number, Secretary of State file number, and Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN).
2. Provide the seller’s address, including suite, room, or PO Box, along with the city, state, and ZIP code.
3. Enter the address of the property sold, including the parcel number and county. Ensure that the property is identified correctly.
4. Read the perjury statement carefully and certify that the property is a single-family residence that has never been previously occupied. Sign and date the form.
5. Include the seller’s contact name and telephone number for any follow-up communication.

6. Part II - Escrow Information: Enter the escrow number and the date escrow closed in the specified fields.
7. Provide the name of the escrow company and the contact person, along with their telephone number.
8. Input the total purchase price of the property.
9. Indicate whether all buyers will be living in the home as their principal residence by checking the appropriate box. If "Yes," proceed to line 5. If "No," skip to line 6 instructions.
10. If "Yes" is checked, enter 5% of the total purchase price or $10,000, whichever is less. If "No," enter the qualified purchase price on line 6.
11. Calculate and enter 5% of the qualified purchase price or $10,000, whichever is less, on line 7.

12. Part III - Qualified Buyer’s Information: Complete this section for each qualified buyer. If there are more than three buyers, attach additional copies of Side 2 of form FTB 3528-A.
13. For each buyer, enter their first name, middle initial, last name, SSN or ITIN, ownership percentage, and telephone number.
14. Include the mailing address for each buyer and ensure that signatures and dates are provided where required.
15. If applicable, include information for spouses or registered domestic partners, ensuring the combined ownership percentage is entered in the appropriate field.
16. Once all sections are filled out, review the form for accuracy before submission.

After completing the form, it is crucial to fax it to the Franchise Tax Board at the specified number within one week of the close of escrow. This ensures that the application is processed in a timely manner. A copy of the completed form should also be provided to the buyer for their records.

What is the California 3528 A form?

The California 3528 A form, also known as the Application for New Home Credit, is used by sellers of newly constructed homes that have never been occupied. This form allows sellers to certify that the property qualifies for a tax credit under California law. It must be completed and submitted to the Franchise Tax Board (FTB) when a home is sold to eligible buyers.

Who is eligible to use the 3528 A form?

The form is intended for sellers of single-family residences that have never been occupied. Buyers must also meet specific criteria, including the intention to occupy the home as their principal residence for at least two years. The credit can only be claimed by buyers who complete the necessary sections of the form and provide accurate information.

How do I complete the Seller’s Certification section?

In the Seller’s Certification section, you need to provide your name, identification number (such as SSN or ITIN), and the property address. You must certify that the home has never been occupied and that all information is accurate to the best of your knowledge. Finally, sign and date the form to validate your certification.

What information is required in the Escrow Information section?

This section requires details about the escrow process, including the escrow number, the date the escrow closed, and the name of the escrow company. You also need to provide the total purchase price of the property and indicate whether all buyers will live in the home as their principal residence. This information is critical for determining eligibility for the tax credit.

What is the maximum tax credit I can receive?

The maximum tax credit available through the California 3528 A form is $10,000. If the calculated credit amount based on the purchase price is higher than this limit, you will only receive the maximum of $10,000. The credit is calculated as 5% of the total purchase price or the qualified purchase price, whichever is less.

How is the credit allocated among multiple buyers?

If there are multiple buyers, the credit is allocated based on each buyer’s ownership percentage. For married couples, they are treated as one buyer, and their combined ownership percentage is used. Each buyer’s individual credit is then calculated based on their percentage of ownership in the property.

What happens if the home is not occupied for the required two years?

If the buyer does not occupy the home as their principal residence for at least two years, they may lose the right to claim the credit. The credit is contingent upon the buyer's commitment to live in the home for this minimum period, as stated in the certification.

How should I submit the 3528 A form?

The completed form should not be mailed. Instead, the escrow person must fax the form to the FTB at 916.845.9754 within one week of the close of escrow. A copy should also be provided to the buyer. It is essential to use the correct fax number to ensure proper processing.

What should I do if I have more than three buyers?

If there are more than three buyers, you will need to attach additional copies of the Qualified Buyer’s Information section. Each buyer must complete their information on the attached forms to ensure that all ownership percentages and details are accurately recorded for the credit allocation.

When completing the California 3528 A form, individuals often make several common mistakes that can lead to complications. One significant error is failing to provide complete and accurate seller information. The seller's name, identification number, and address must be filled out clearly. Omissions or inaccuracies in these details can delay processing and may even result in the rejection of the application.

Another frequent mistake involves misunderstanding the requirements for the principal residence. Many applicants mistakenly check the box indicating that all buyers will live in the home as their principal residence when that is not the case. This can lead to incorrect calculations of the credit amount and may necessitate further clarification from the Franchise Tax Board.

Additionally, individuals often miscalculate the total purchase price or the qualified purchase price. It is essential to enter the correct figures, as errors in these amounts can affect the credit calculation. Rounding errors can also occur, so it is important to ensure that all amounts are rounded properly to the nearest whole dollar.

Lastly, applicants frequently overlook the submission timeline. The form must be faxed to the Franchise Tax Board within one week of the close of escrow. Failure to meet this deadline can result in the loss of the tax credit. Staying mindful of these deadlines is crucial for a successful application process.

When completing the California 3528 A form, several other documents may be necessary to ensure compliance and support the application process. Here are some commonly used forms and documents that accompany the California 3528 A:

• California Form 540: This is the standard individual income tax return form for California residents. It is essential for reporting income and claiming any credits, including the New Home Credit.
• California Form 540NR: This form is for non-residents or part-year residents of California. It is used to report income earned in California and claim applicable credits.
• Escrow Instructions: These are detailed guidelines provided by the escrow company outlining the responsibilities and procedures for both the buyer and seller during the escrow process.
• Grant Deed: This legal document transfers ownership of the property from the seller to the buyer. It is essential for establishing the buyer’s legal claim to the property.
• Title Report: This report provides information about the property’s ownership history and any liens or encumbrances. It is crucial for ensuring that the property is free of legal issues before purchase.
• Homeowner’s Exemption Claim Form: This form is used to apply for a property tax exemption for the primary residence. It is often filed concurrently with the purchase to maximize tax benefits.
• Property Disclosure Statement: This document outlines any known issues or defects with the property. Sellers are typically required to disclose such information to potential buyers.

Each of these documents plays a vital role in the home-buying process, ensuring that both buyers and sellers are protected and informed. Properly preparing and submitting these forms can facilitate a smoother transaction and help avoid potential legal complications.

The California Form 3528-A, used for applying for the New Home Credit, shares similarities with several other important documents related to real estate transactions and tax credits. Below is a list of seven documents that have comparable functions or purposes, along with a brief explanation of how each relates to the California 3528-A form.

• IRS Form 5405: This form is used to claim the First-Time Homebuyer Credit. Like the California 3528-A, it serves as an application for a tax credit related to home purchases, specifically for those who are first-time buyers.
• California Form 540: This is the California Resident Income Tax Return. Both forms ultimately contribute to tax calculations and credits for individuals, with the 5405 focusing on home purchases and the 540 detailing overall income tax obligations.
• IRS Form 8862: This form is used to claim the Earned Income Credit after a disallowance. Similar to the California 3528-A, it requires the taxpayer to provide specific information to qualify for a tax benefit, ensuring compliance with tax regulations.
• California Form 3506: This is the application for the New Home Credit for homebuyers. It parallels the 3528-A in that it is designed for individuals purchasing new homes, focusing on the eligibility and amount of the credit available.
• California Form 593: This form is used for withholding on the sale of California real estate. Like the 3528-A, it involves transactions related to property sales and requires detailed information about the parties involved.
• IRS Form 1098: This is the Mortgage Interest Statement. It is similar in that it provides important tax-related information for homeowners, detailing the interest paid on a mortgage, which can affect tax liabilities and credits.
• California Form FTB 3814: This form is the California Child and Dependent Care Expenses Credit. Although it addresses a different type of credit, both forms require detailed personal information and are used to claim tax benefits, ensuring compliance with state tax laws.

When filling out the California 3528 A form, it is crucial to adhere to specific guidelines to ensure accuracy and compliance. Below is a list of things to do and avoid:

• Do print all information clearly to avoid misunderstandings.
• Do ensure that the property has never been occupied before submitting the form.
• Do include all required identification numbers, such as SSN or ITIN for individuals and FEIN for corporations.
• Do check the appropriate boxes regarding residency to ensure proper processing.
• Do submit the form via FAX to the correct number within one week of closing escrow.

• Don't leave any fields blank; incomplete forms may lead to delays or rejections.
• Don't mail the form; it must be sent via FAX to the designated number.
• Don't include buyers who do not have an ownership interest in the property.
• Don't attempt to claim the credit without receiving confirmation of allocation from the FTB.

Understanding the California 3528 A form can be a bit tricky, especially with the various myths surrounding it. Here are six common misconceptions, along with clarifications to help you navigate this important document.

• Myth 1: The form can be submitted anytime after the sale. Many believe they can file the 3528 A form at their convenience. In reality, it must be submitted within one week after the close of escrow.
• Myth 2: Any home qualifies for the credit. Not every home is eligible. The property must be a new single-family residence that has never been occupied before.
• Myth 3: The credit is available to all buyers. This is not true. Only buyers who intend to live in the home as their principal residence for at least two years can claim the credit.
• Myth 4: The credit can be carried over to future years. Some think they can carry over unused credits. However, if the available credit exceeds the current year’s net tax, it cannot be carried over to the following year.
• Myth 5: All buyers on the title can claim the full credit. In fact, the credit must be allocated among the buyers based on their ownership percentages, which may limit how much each person can claim.
• Myth 6: The form needs to be mailed to the FTB. A common misunderstanding is that the form should be mailed. Instead, it must be faxed to the Franchise Tax Board (FTB) at the designated number.

By clearing up these misconceptions, you can better understand the requirements and ensure that you properly complete the California 3528 A form. Knowledge is key when it comes to navigating tax credits!

Filling out the California Form 3528-A can be straightforward if you keep a few key points in mind. Here are some essential takeaways to help you navigate the process:

• Purpose of the Form: Use Form 3528-A to apply for the New Home Credit when selling a new home that has never been occupied. This credit can provide significant tax benefits for eligible buyers.
• Seller's Certification: The seller must complete Part I, certifying that the property is a single-family residence that has never been occupied. This certification is crucial for the application to be valid.
• Escrow Details: In Part II, you must provide specific escrow information, including the escrow number and the date it closed. This information helps establish the timeline of the transaction.
• Principal Residence Requirement: Buyers must indicate whether they will be living in the home as their principal residence. If all buyers will reside there, the credit calculation is simplified.
• Credit Calculation: The credit amount is either 5% of the total purchase price or $10,000, whichever is less. Be sure to follow the instructions carefully to determine the correct amount.
• Submission Guidelines: After completing the form, the escrow company must fax it to the Franchise Tax Board (FTB) within one week of the close of escrow. Do not mail the form, as it will not be processed.

By keeping these points in mind, you can ensure a smoother experience when filling out and submitting the California Form 3528-A. Proper attention to detail will help maximize the benefits of the New Home Credit for eligible buyers.