Reject Code S2-F1040-428 and S2-F1040-429

Reject Codes S2-F1040-428 and S2-F1040-429 occur when the IRS database indicates that the taxpayer or spouse received a First Time Homebuyer Credit in a previous year and did not include the repayment amount on this year's return. If the first-time homebuyer credit was claimed by a taxpayer for a home that was purchased in 2008, repayment of the credit began with the 2010 tax return and continues for 15 years or when the house is sold, whichever is earlier. The amount that the IRS believes the taxpayer owes as installment payment can found at the IRS website for First Time Homebuyer Credit Lookup.

Desktop - How to Correct Reject S2-F1040-428 and S2-F1040-429

To include a First Time Homebuyer installment payment, from the main menu of the tax return (Form 1040), select:

Other Taxes
First-Time Homebuyer Credit Repayment
2008 First-Time Homebuyer Credit Repayment - Enter the amount of the repayment to include on the return (generally $500, or $250 for the taxpayer and the spouse if MFJ in the year they received the credit). If you are unsure of the amount to enter, select First Time Homebuyer Credit Account Look-up. In order to look up the payment amount, you will need to know the taxpayer and/or spouse's SSN, the taxpayer and/or spouse's date of birth, and the address of the house that the taxpayer/spouse received the credit for.

Form 5405 only needs to be completed if the house was sold in the current year, or the house ceased being the taxpayer's main home in the current year.

ProWeb - How to Correct Reject S2-F1040-428 and S2-F1040-429

To include a First Time Homebuyer installment payment, from the Tax Return Summary page (Form 1040), select:

Federal Section
Other Taxes
Repayment of First-Time Homebuyer Credit
If a MFJ return, select Taxpayer or Spouse.
Did the home stop being your primary residence during the current year? Mark Yes or No. Form 5405 will be included with the return only when this question is set to yes.
Repayment of Credit
Enter the total credit amount the taxpayer received in 2008 if they did not file a joint tax return in 2008. Enter 1/2 of the total credit the taxpayer received in 2008 if they filed a MFJ return in 2008.

Enter the total amount that the taxpayer has repaid in prior years if they did not file a joint tax return in 2008. Enter 1/2 of the total amount that the taxpayer has repaid in prior years if they filed a MFJ return in 2008.

Enter the total amount of this year's repayment amount if they did not file a joint tax return in 2008. Enter 1/2 of this year's repayment amount if they filed a MFJ return in 2008.

If you are unsure of the amount to enter, select IRS First Time Homebuyer credit account look-up tool. In order to look up the payment amount, you will need to know the taxpayer and/or spouse's SSN, the taxpayer and/or spouse's date of birth, and the address of the house that the taxpayer/spouse received the credit for.