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IRS notice on FTHB Payback

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    #1

    IRS notice on FTHB Payback

    I have not been doing this. Just got this email today.



    Attn: Software Developers, Return Transmitters and Authorized IRS e-file Providers/EROs

    When e-filing a repayment of the First-Time Homebuyer’s Credit, we recommend the following actions to expedite processing:



    When Married Filing Jointly for TY 2010 and only one spouse received the homebuyer credit for TY 2008, we recommend filing one Form 5405 showing the taxpayer SSN who received the credit and is making a repayment.



    When filing Married Filing Jointly for TY 2010 and the homebuyer credit was received from a Married Filing Joint return for TY 2008, we recommend filing two Forms 5405; one for each taxpayer SSN and making a repayment for each form based on ½ of the total credit received by the spouses. For repayment purposes, the credit received for TY 2008 is considered split equally between the two spouses when taxpayers received the credit on a joint return so filing two distinct forms when repaying the credit should help expedite processing.
    "I am proud to pay taxes in the United States. The only thing is I could be just as proud for half the money." Arthur Godfrey
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    #2
    Too late

    Yeah, I have done two where a single guy got the $7500 loan for 2008.

    Both guys got married in 2010. (Get a house, get a wife? No, I did not just say that.)

    I prepared one 5405 (in fact, I think my software will not allow two to open) on the 2010 MFJ returns. Both clients got their refunds, but they were later than usual due to "processing delays".
    If you loan someone $20 and never see them again, it was probably worth it.

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      #3
      One for 2?

      I've done MFJ where they both got the credit and filed the repayment putting the entire $500 payment on one 5405.
      Did I read this wrong? I thought this was saying that if you had MFJ and both got the combined credit, you need to file separate 5405s, one payment for each, $250.
      "I am proud to pay taxes in the United States. The only thing is I could be just as proud for half the money." Arthur Godfrey

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        #4
        I can see the reasoning for this. The repayment process is 15 years. In the event of separate credits, or subsequent divorce, say -- they can track who the credit (or bill) should actually be attributed to for future computations.

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          #5
          So change my practice...

          Originally posted by Burke View Post
          I can see the reasoning for this. The repayment process is 15 years. In the event of separate credits, or subsequent divorce, say -- they can track who the credit (or bill) should actually be attributed to for future computations.
          So, let the ones go that have been filed, but hence forth and forevermore, do them separately...

          There aren't a lot of these anyway. Not such a big deal, but noteworthy.
          "I am proud to pay taxes in the United States. The only thing is I could be just as proud for half the money." Arthur Godfrey

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            #6
            Good post. I have two that have to repay. Already prepared them but will do this in the future.

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