Repayment of the First-Time Homebuyer Credit from 2008April 2, 2012 — 1,500 views
Approximately 1.2 million taxpayers took advantage of the first-time homebuyer credit from 2008 and are now left to pay Uncle Sam back for the loan, according to CrossLink. Americans who bought a home in 2008 using the government’s tax credit will be required to start paying it back to the Internal Revenue Service (IRS) starting with their 2010 tax return.
If a homebuyer took advantage of the maximum $7,500 credit, they will have to add $500 to their income tax liability for the next 15 years, reports CNN.com. Two years later and those people are now filling out line 59B of Form 1040 with the amount they have annually paid on additional tax. A homeowner may be required to attach a Form 5329.
If a taxpayer sells the house before the 15 years are up, the entire tax credit bill will be due the year the house is sold, reports the news source. A taxpayer may wish to consult with a professional personal finance specialist experienced in tax reporting in order to avoid complications and stress.