My husband and I recieved the 7500 interest free loan for tax year 2008 and now have learned from the IRS that we should not have been given it.
BACKGROUND: my husband purchased his first home in 11/2004 and sold in 12/2007. Together we purchased a home in 07/2008.
In 2009 when we went in to do our taxes, we did not think we qualified for the first time homebuyer loan given that this was my husbands SECOND home, my first. Our tax preparer assured us that we DID qualify because it was MY first home, so we did not argue, thinking he knew what he was talking about. So we got the 7500 interest free loan, being fully prepared to pay it back as required: 500/year for 15 years. This week we recieved a letter from the IRS regarding the loan, and when I spoke to a representative I learned that we should NOT have recieved the loan and will have to work out a payment plan. (I am assuming this plan will NOT be over 15 years as we were expecting…) I have been trying to get in touch w/ the tax preparer to see what he has to say, though inevitably I know he cannot do anything. But I now know that we have an interest penalty that we will have to pay to the IRS.
I looked at all our paperwork from when we did our taxes and we never paid for any kind of insurance or recieved any guarantee that their work would be correct. But we also never signed any forms or disclaimers waiving their liability. What should I expect legally from this tax preparer? Can I expect him to at least cover the interest???