Late wife being hit for FTHB installment payment on house she bought with ex who still owns the house.

[lundegr]

I have been battling the IRS for 4 years about a first time homebuyer installment payments.  I found out while filing this year that it is my wife who they say owes.  My wife passed away last year and I am kind of stuck but here is the story.  My late wife bought a house with her ex husband.  He got the house in the divorce and still owns it/lives there.  Why is my late wife being hit with this and what do I do?

[MiriamF]

So sorry to hear of the loss of your wife.

To solve your problem, you need to file form 5405. Check box h in Part I indicating that the homeowner has died. When one of the owners passes away, their portion of the first-time homebuyer credit repayment is forgiven.

To add Form 5405 in TurboTax, follow these steps: 

1. Sign into your account and select your current return 

2. Select My Account and the select Tools 

3. Select Topic Search top left 

4. Search for 5405 and select go 

This will take you directly to the interview for this form.