2008 First Time Homebuyer Credit and Divorce

2 Replies

In 2008, my ex-spouse and I took the $7500 First Time Homebuyer Credit.  We've consistently made payments of $500 each year in our taxes. When we divorced, I kept the home. This year I paid the $500 in my taxes, since I'm now responsible for the full balance.  The IRS just sent me a letter requesting I complete Form 5405 to support paying the $500. However, when I enter what I think is the correct info on the form, it's telling me to enter the full balance of the loan ($4500) on line 60b of my 1040, instead of the $500 annual payment. I tried calling the IRS, but after being on hold a few minutes their system hangs up the call.  From what I've read, I don't think I even need to send them this form, since I'm still living in the residence and making annual payments on the loan/credit.  Am I correct?

Thank you,


@Julie Blue

It looks to me like your ex-spouse would file this form to absolve themselves of the repayment obligation.  Ex would complete Part 1 and check box E and enter your name.

You would simply enter the $500 on line 60b.

If you are amicable with your ex, you could ask them to file 5405 and that should clear up the issue.

Unfortunately, the IRS system is the worst and not user friendly.

Good luck and I hope this helps.