How do I add or remove Form 5405 for the first-time homebuyer credit?

by TurboTax•699• Updated 4 months ago

If you took advantage of the 2008 First-Time Homebuyer Credit (which was actually an interest-free loan), you'll repay it in equal portions for 15 years, starting with your 2010 tax return.

Your repayment is an additional tax that will either lower your refund or increase your tax bill through tax year 2025. If you got the full $7,500 credit, the additional tax is $500 per year; otherwise, if you got less than that, your repayment is 6.66% of the total loan amount.

Form 5405 (Repayment of the First-Time Homebuyer Credit) figures the repayment amount (actually, an additional tax) for the 2008 First-Time Homebuyer Credit. The 5405 is also used to notify the IRS that the home was disposed of or ceased to be your main home.

Choose your product for info on how to enter—or delete—Form 5405.

TurboTax Online

Open or continue your return.
Go to the Tell Us About Your Homebuyer Credit screen, answer Yes to the first question (it was still your main home on January 1, 2024).
- To delete an unwanted 5405, answer Yes to the second question (it stopped being your main home). Then select Continue and answer Yes on the next screen. You're done.
Enter the purchase date and then follow the onscreen instructions.

TurboTax Desktop

Open or continue your return.
Select Federal Taxes, then Deductions & Credits.
In the Your Home section select Start or Revisit next to Homebuyer Credit Repayment.
On the Tell Us About Your Homebuyer Credit screen, answer Yes to the first question (it was still your main home on January 1, 2024).
- To delete an unwanted 5405, answer Yes to the second question (it stopped being your main home). Then select Continue and answer Yes on the next screen. You're done.
Enter the purchase date and then follow the onscreen instructions.

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