1st HBC purchased from "Grandma's Estate" qualify?

[nwtaxlady]

Grandma died 10 months ago. Grandaughter and her husband bought the house from "The Estate of Jane Smith" and closed Nov 13, 2009. From what I have read you cannot qualify if you purchase the house from a Grandparent. OK....how about purchasing from the Estate?

Again, just closed on 11/13/09 and purchased the house from the "Estate" which happens to be her Grandma's Estate. So do they qualify for the $8,000 credit?

[BP.]

Grandma died 10 months ago. Grandaughter and her husband bought the house from "The Estate of Jane Smith" and closed Nov 13, 2009. From what I have read you cannot qualify if you purchase the house from a Grandparent. OK....how about purchasing from the Estate?

Again, just closed on 11/13/09 and purchased the house from the "Estate" which happens to be her Grandma's Estate. So do they qualify for the $8,000 credit?

Looks like the Buyer & Seller are related parties.

From Form 5405 Instructions: http://www.irs.gov/pub/irs-pdf/f5405.pdf

“For more information about related persons, see Nondeductible Loss in Chapter 2 of Pub. 544, Sales and Other Dispositions of Assets. When determining whether you acquired your main home from a related person, family members in that discussion (except item 7) include only the people mentioned in 8a above.”


From Pub 544, p. 22: http://www.irs.gov/pub/irs-pdf/p544.pdf

“Related Persons- An executor and a beneficiary of an estate unless the sale or exchange is in satisfaction of a pecuniary bequest.”