You might not have to repay this interest-free loan if you sell your house at a loss. By Kimberly Lankford, Contributing Editor August 9, 2011 I claimed the $7,500 tax credit for a house that I purchased in 2008, then sold the house at a loss a year later. Do I still need to repay the IRS for the $7,500 credit?Maybe not. The 2008 first-time home-buyer tax credit was actually an interest-free loan that must be repaid in $500 increments over 15 years, starting with your 2010 return. If you sell your house within 15 years – before you finish repaying the tax credit – then you generally must repay the balance of the credit in a lump when you file your taxes for the year you sell the house. But there is an exception for home-sale losses. You only have to repay the credit up to the amount of gain, if any, on the sale. The worksheet with the instructions for IRS form 5405 can help you calculate your gain or loss. You must subtract the remaining credit from your basis to determine whether you actually have a loss. Got a question? Ask Kim at email@example.com.