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Posted by : Daniel Stoica in (Blog, Tax Credit, Tax Filing, Tax Help, Tax Tips) On: February 2nd, 2012
Do You Need to Repay Your First-Time Homebuyer Credit?
Tagged Under : First-Time Homebuyer Credit, form 1040, Form 5405, IRS, repayment obligation, tax preparer
Are you one of the individuals who needs to repay the First-Time Homebuyer Credit? If you’re not sure, you can use an online look-up tool on the IRS website to check if you have a repayment obligation.
Here’s a link to the online lookup tool that will help you determine this information: https://sa1.www4.irs.gov/irfof-fthb/
Also, here are some tips to help you look up information about your First-Time Homebuyer Credit:
1. Determine if you need to repay the credit. If you bought a home in 2008 and claimed the First-Time Homebuyer Credit, the credit is similar to a no-interest loan and must be repaid in 15 equal annual installments that began with your 2010 return. Also, anyone who sold their home, or stopped using it as their main home, may have to repay the entire credit whether their home was purchased in 2008, 2009 or 2010.
2. The First-Time Homebuyer Credit Tool will provide critical account information to help you report your repayment obligation on your tax return. To access the online tool you will need:
-Social Security number
-date of birth
-complete address
If you file a joint return, you will only be able to access your portion of the First-Time Homebuyer Credit account information.
3. The online tool will show the original amount of the credit, annual repayment amounts, total amount paid and the total balance left to be paid. You will be able to print your account page to share with your tax preparer and keep for your records.
4. To repay the First-Time Homebuyer Credit, add the amount you have to repay to any other tax you owe on your federal tax return. This could result in an additional tax owed or a reduced refund. To repay the credit, you report the repayment on line 59b on Form 1040, U.S. Individual Income Tax Return. If you make an installment payment, you do not need to attach Form 5405, First-Time Homebuyer Credit and Repayment of the Credit, to your tax return. However, if you are repaying the credit because the home stopped being your main home, you must attach Form 5405.
You can access the First-Time Homebuyer Credit Look-up Tool at any time, day or night.
