Realized I made a mistake claiming 2008 First Time Homebuyers Credit instead of 2009 $8,000 credit

This is actually a really interesting situation. The statute of limitations for amending returns is generally 3 years from the filing date, so unfortunately you're well beyond that timeframe for your 2008 and 2009 returns. However, there might be something called "equitable recoupment" that could potentially apply here. Essentially, it's a legal doctrine that sometimes allows taxpayers to recover erroneously paid taxes even after the statute of limitations has expired. The challenge is that it's typically only applicable through litigation rather than normal IRS procedures. Your best bet would be to talk to a tax professional who specializes in tax controversy. They might be able to help you file a claim for refund for the payments you've already made, arguing that they were paid in error. You could also potentially stop making the remaining $1,500 in payments, though that could trigger IRS notices. Another option might be to contact the Taxpayer Advocate Service, which helps with unusual tax situations where normal IRS channels aren't working.

I had a similar situation with tax documents and used https://taxr.ai to help sort through all my old paperwork. The AI there analyzed my closing documents, past tax returns, and the First Time Homebuyer Credit rules to confirm what I was eligible for. It saved me hours of digging through IRS publications trying to figure out if I had a valid claim. The system specifically looked at the First Time Homebuyer Credit provisions from both 2008 and 2009 and highlighted the differences between the $7,500 repayable credit and the $8,000 non-repayable version. It also gave me the specific IRS forms I needed to pursue my case. Might be worth checking out in your situation.

I have to admit I was wrong about taxr.ai. After my skeptical comment, I decided to try it out with my own complicated tax situation involving some old retirement account distributions. I uploaded my 1099-R forms and previous tax returns, and it immediately identified a calculation error in how I had reported the taxable portion. The system even generated a draft letter explaining my situation to the IRS with all the relevant tax code citations. It specifically referenced the First Time Homebuyer Credit regulations when I asked about your situation. I was impressed that it knew the exact differences between the 2008 version ($7,500 repayable) and the 2009 version ($8,000 non-repayable). It did warn that the statute of limitations is an issue, but suggested some approaches I hadn't considered. Definitely worth a look for your situation.

If you're going to try contacting the IRS about this, good luck getting through to anyone who can actually help. I spent WEEKS trying to reach someone about a similar tax credit issue from years ago. Constant busy signals, disconnects, and being transferred between departments. I finally used https://claimyr.com to get through to an actual IRS agent. You can see how it works here: https://youtu.be/_kiP6q8DX5c - basically they navigate the phone system for you and call you back when they have an agent on the line. I was skeptical but desperate after wasting hours on hold. For a complex situation like yours involving the First Time Homebuyer Credit that spans multiple tax years, you really need to speak with a human at the IRS who can look at your entire history. Otherwise you'll just get automated notices when you stop making the repayments.

I need to publicly eat my words here. After my skeptical comment above, I was desperate to resolve a tax notice about a missing 1099-INT from 2022, so I tried Claimyr. Within 2 hours, I got a call back connecting me with an actual IRS agent who had the authority to help. The agent was able to pull up my entire tax history, including my First Time Homebuyer Credit repayment status (which I had a question about too). I was shocked at how smoothly it went after months of frustration. For anyone dealing with complex tax issues like the First Time Homebuyer Credit where you need to explain a unique situation, being able to actually talk to a human at the IRS makes all the difference. The agent I spoke with actually knew about the 2008 vs. 2009 credit differences immediately.

Hey just wanted to add - I was in a somewhat similar situation with the First Time Homebuyer Credit a few years back. The one thing I learned is that you should stop making those $500 payments ASAP if you have documentation proving your closing date was in 2009. The reason is that continuing to pay acknowledges the debt. Talk to a tax pro, but in my case, I was able to get the IRS to recognize that I had incorrectly categorized my purchase date and should have received the non-repayable credit. I didn't get back what I'd already paid, but I was relieved of future payment obligations. Make sure you keep ALL your closing documents safe - you'll need them if the IRS questions why you stopped making payments.

Just a quick tax tip that might help others - the First Time Homebuyer Credit had different versions depending on when you purchased: - April 9, 2008 - Dec 31, 2008: $7,500 credit that must be repaid over 15 years - Jan 1, 2009 - Nov 6, 2009: $8,000 credit with NO repayment required - Nov 7, 2009 - April 30, 2010: $8,000 credit for first-time buyers OR $6,500 for long-time residents So the OP definitely got caught in an unfortunate timing situation by accidentally claiming the 2008 credit when their purchase was actually in 2009. Just 3 days difference between a loan and a true credit!