After renting an apartment for five years, Todd and Diane purchased a new home o

Question

After renting an apartment for five years, Todd and Diane purchased a new home on July 1, 2008. On their 2008 joint tax return, they claimed a $7,440 first-time home buyer credit. Answer the following questions relating to the credit.

Assuming they still live in the home, what amount of credit must Todd and Diane repay with their 2013 tax return?

Assuming they sell the home in August 2013 for a $34,430 gain, what amount of credit must they pay back with their 2013 tax return?

Assuming they sell the home in August 2013 for a $5,220 gain, what amount of credit must they pay back with their 2013 tax return?

After renting an apartment for five years, Todd and Diane purchased a new home on July 1, 2008. On their 2008 joint tax return, they claimed a $7,440 first-time home buyer credit. Answer the following questions relating to the credit.

Explanation / Answer

Assuming they still live in the home, what amount of credit must Todd and Diane repay with their 2013 tax return?

anser=496

Because they purchased the home and claimed the credit in 2008, they must pay back the credit in 15 equal installments beginning with 2010. With their 2011 tax return, Todd and Diane must repay 496

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