Form 5405 and Foreclosure

[Bonnie]

Taxpayer had First Time Home Buyer credit in 2008 and has been paying back 500 every year. She moved out of state due to job and now the house is in foreclosure, but still going thru the process of foreclosure. Trying to decide if she pays the 500 again for 2015 or if I fill out the 5405 and indicate she sold (foreclosed). It is no longer her home. Does this apply when the foreclosure process starts or on the date it is final?

[kathyc2]

Taxpayer had First Time Home Buyer credit in 2008 and has been paying back 500 every year. She moved out of state due to job and now the house is in foreclosure, but still going thru the process of foreclosure. Trying to decide if she pays the 500 again for 2015 or if I fill out the 5405 and indicate she sold (foreclosed). It is no longer her home. Does this apply when the foreclosure process starts or on the date it is final?

Actually, the balance is supposed to be paid back if the house is no longer personal residence. The foreclosure should not be reported until final.

[Bonnie]

In another thread about this a couple weeks ago, I understood she did not have to pay back the balance owed because it is treated as sell of home with no gain.

[kathyc2]

In another thread about this a couple weeks ago, I understood she did not have to pay back the balance owed because it is treated as sell of home with no gain.

The instructions for 5405 indicate that it should be filed if it is no longer your main home. I don't know if there is an exclusion or not on repayment if due to a job related move.