HI There, you are in a very similar situation to me. I own a home in England and purchased my first home in the UNited States last year. We have waited 12 months for the tax credit as we were advised by a number of people including the IRS website that Yes we would be allowed because owning a home in another country does not exclude you. basically it is not counted.
ANyway, just got a letter from the IRS denying the claim, stating that we had owned a home in the previous 3 years!
I do believe this is a mistake on their part. The IRC section 36 law does not seem to specify any details about owning a principle residence in another country, except for one very important area:
CODE SEC. 36. FIRST-TIME HOMEBUYER CREDIT.
36(a) ALLOWANCE OF CREDIT. --
In the case of an individual who is a first-time homebuyer of a principal residence in the United States
during a taxable year, there shall be allowed as a credit against the tax imposed by this subtitle for such
taxable year an amount equal to 10 percent of the purchase price of the residence.
I am not a law professional but it would seem that the above, implicitly implies that the owning a principle residence in another country is not relevant because they are only concerned with your first time purchase in the UNited States.
PLease can anyone with experience within this code comment?