We have had several home buyers credit returns, but have had no problems with them.

One reason you might be having the difficulty----------you indicated the return showed no tax liability, so the IRS is probably wondering how the person could afford the house, and therefore is it a real live situation.   That issue, I would have guessed, would have been addressed in the documents sent with the original return.

The HUD-1 statement is a prime component of the "documentation" needed to accompany the return.

The issue of the IRS letters---------- I am GUESSING that the taxpayer received a 30 day letter.........see reference below to IRS website..............and if response was appropriate, that should have handled the issue, unless the response was not timely, in which case IRS would have jumped into the assessment mode, and now you might need to file with Tax Court---------but that seems pretty extreme for what is being said.

IRS usually puts in the "regular" letters that the taxpayer can always file and appeal through tax court........but they are merely informing the taxapyer of their rights.

I am guessing that the root issue is the timeliness of the responses.

I hope to hell you're responding by certified mail with return receipt............that is the ONLY way to make sure in matters like this.

One of the posters indicated contacting the Advocate's office----------good advice.

Also, the CPA----------I assume-----------is aware of the office for tax pros.............we usually go directly to them, since they have always been able to cut through the "stuff" and tell us exactly where the situation stands, since we often get called into the game after it has already started.  After finding out where the situation stands, merely follow the yellow brick road..........but sounds like you need to establish EXACTLY where the IRS computers are saying you are..........since that is what anyone at IRS who touches the case will look to for status determination.........and therefore what the next step is. 

 http://www.irs.gov/individuals/article/0,,id=160744,00.html