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We prepare most type of tax returns:

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S Corporation.

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Partnership.

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Amended.

Gary Bode, CPA is a Master's Degreed, nation wide accountant offering tax and business services. Member of AICPA and NCACPA. Our virtual office provides excellent service to long distance and international clients. Call (910) 399-2705 for a free phone consult.

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avatar"Gary Bode has just completed our tax returns for the first time and I am totally satisfied with his level of service. He has been very attentive, asked all the right questions, and not only fixed some problems from our previous accountant, but also set us up for future success through a thorough and professional analysis of our corporate structure in conjunction with several personal variables.

I have worked with quite a few CPA’s in my life, and Gary has proven himself to be one of the most thoughtful, insightful, and pleasant fellows I have ever worked with."—J. Louis Tabor

Tabor Foods, LLC

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Even though Gary enjoys helping colleagues, we no longer provide free consults to other tax preparers. He's happy to consult on an hourly billing basis if our schedule allows.

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Wilmington NC CPA comments on Form 5405 |First Time Homebuyer Credit Repayment Issues

Wilmington NC CPA and tax accountant discusses tax Form 5405

Gary Bode, CPA: If you need a free initial consult on the First Time Homebuyer's Credit, please call us at 399-2705

We’re seeing some interesting problems over repayment of the First Homebuyer Credit on Form 5405.  This Credit morphed more, and faster, than most IRS tax incentives.  The amount went up, then it didn’t require re-payment, and finally, folks who had previously owned houses could join in, albeit for a lesser amount.  All with arbitrary date cutoffs. 

Repayment of the First Homebuyer Credit, if required, presents on tax form 5405 and included with Form 1040 tax preparation.  Of course, there is resentment with folks that actually must repay anything.

Paying it All Back at Once – Ouch!

Ordinarily, repayment, if required, is spread out over 15 years via Form 5405.  But the IRS mandates that if you stop using your home as a primary residence, within three years of purchasing it (which includes selling it, converting it to a rental and losing it in foreclosure) the Credit must be repaid, in it’s entirety, on that year’s tax return.  So, some folks who took the credit with good intentions have to unexpectedly pay back up to $8000, to the IRS, at one time.  Since the First Time Homebuyer’s Credit had income limitations, as one qualification, this repayment is probably a hard blow to anyone affected.

“Some taxpayers got a nice sized tax credit and then lost their home.  Now they have to repay immediately.  An unintended, but nasty, cash flow trap!”
Gary Bode, Wilmington NC CPA and tax accountant

We’ve had examples of folks who inappropriately applied for the Credit.  Form 5405 caused a lot of genuine confusion and subsequent, unintended, traps.  The IRS allowed inappropriate tax returns initially.  Then, once examined, triggered a tax audit via the infamous Notice CP 2000.

We’re a Wilmington NC CPA firm specializing in tax preparation. If you need a free initial consult with a tax accountant, please call us at 399-2705.

Of course we offer other services too besides tax preparation, like financial accounting, QuickBooks training and business consulting.  Please read any of our posts to guage our expertise, proactive attitude and commitment to customer service.  Your CPA really can make a difference.

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