Repayment of 1st Time Homebuyer Credit

[peggysioux]

Taxpayer received the 1st Time Homebuyer Credit in 2008. In July of 2013, taxpayer was sent to a temporary assignment that was supposed to last for 9 months. He rented out his primary residence while he was on temporary assignment, but being it was very temporary, he did not repay the remaining balance of his 1st time homebuyer credit. Assignment ending up lasting into the 1st Quarter of 2015 and taxpayer continued to rent out his primary residence all of 2014. Being the assignment lasted much longer than anticipated, should he repay the remaining balance in 2014? In March of 2015, taxpayer did move back into primary residence.

[Roland Slugg]

Should he repay the remaining balance in 2014?

I don't think so. Here is the relevant portion of the instructions for F-5405:

File Form 5405 if ... you disposed of your home or you ceased using the home as your main home in 2014.

Your client suspended using his home, but he resumed using it as his main home in 2015. IMO the full repayment was not triggered. He should, however, repay 1/15th of the original credit on his 2014 return ... $500 or some lesser amount.

P.S. Whenever I see your name on this board, it always reminds me of Buddy Holly

[peggysioux]

Repayment of 1st Time Homebuyer Credit

Buddy Holly -- an entertainer of long ago!!!

Thanks for your input on the 1st Time Homebuyer Credit.

Peggy Sioux