Repayment of the First-Time Homebuyer Credit
If you received the First-Time Homebuyer Credit, you may be required to repay all or part of it, depending on the year you purchased your home and your current situation.
Repayment Rules
- Homes Purchased in 2008:
The credit was structured as an interest-free loan, requiring repayment over 15 years starting with the 2010 tax year. For example, a $7,500 credit required $500 annual repayments. If the home was sold or ceased to be your principal residence before the 15-year period ended, the remaining balance became due in full, unless an exception applied. - Homes Purchased in 2009 or 2010:
These credits generally do not require repayment unless the home was sold or stopped being your principal residence within 36 months of purchase. In such cases, repayment may be accelerated.
Final Year for Repayment
- Tax Year 2024 is the final year for repayment of the 2008 First-Time Homebuyer Credit.
Taxpayers must file Form 5405 with their 2024 federal tax return to report the final installment.