@Littlebit196868 wrote:
I am try to fill out form 5405! I bought a home on 03/14/2008 for 221,000.00 and had to short sell the home and was bought on 11/02/2011 and it sold for 154,000.00 so as you can see I had a loss I received the 7,500.00 and have paid 2000.00 of it back! So how do I fill out this form! Help!
You were required to report the sale on your 2011 tax return using form 5405 at that time. If it was a short sale, you owed no additional payments after that time.
If you did file form 5405 in 2011, then you have never owed a repayment, and you should not have told a tax preparer or Turbotax to make a payment. You may be able to amend to get a refund of excess payments (see below).
If you never filed form 5405 in 2011, then the IRS still thinks you owe a payment. You need to file an amended return for 2011 that reports the short sale, even though it is too late to get a refund if one is calculated. You can't e-file for 2020 if the IRS thinks you owe a payment, so you will have to file by mail. The IRS may still take an extra $250 or $500 from your refund, but there is a way to get that back.
After filing the amended 2011 return to report the sale of the home, you can file amended returns for 2017, 2018 and 2019 to claim a refund of the repayment you made in those years. (The deadline to file the amended 2017 return is April 15, 2021, so don't sit on this.). If the IRS adjusts your 2020 refund to take out a payment, you can file an amended return to get it back, after the IRS has processed the amended 2011 return and recorded the closeout of the credit.
You will need to find a tax professional, or download the 2011 forms and instructions and prepare the amended return yourself, because Turbotax does not support software that old.
You don't owe a payment in 2020, but you can't e-file without making a payment, so file by mail. The IRS may even
