Question

I have a question about repayment of homebuyer credit. I sold my home before living in it for three years. If I had to move for my job, do I have to repay my first-time homebuyer credit using Form 5405?

Answer

Yes. You are responsible for repayment of homebuyer credit. Repay the credit on Form 5405 and attach it to your Form 1040.

The exceptions to repayment of homebuyer credit are for:

  • Government service employees — If the disposition is in connection with government orders
  • Death — If you claim the repayment of homebuyer credit on a joint return, the surviving spouse pays only his or her half of the remaining credit repayment amount.
  • Divorce — If you transfer your home to your former spouse as part of a divorce, he or she is responsible for the rest of the repayments.

To learn more, see Topic 611 at www.irs.gov.

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