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handfseebo · Joined: 22 Sep 2010 Posts: 1 1.26 Dollars($)

If a property is allowed to go into foreclosure (investment) and there is a possibility of a no deficiency judgement, will the bank still issue a 1099-C to the IRS for income?

adonis · Posted: Wed Sep 22, 2010 9:49 pm Post subject:

Welcome handfseebo,

If the bank forgives the deficient amount, then he will issue a 1099c. The forgiven amount will be considered as your income by the IRS and you can taxed for it. However, depending upon the Mortgage Debt Relief Act, you won't be liable for paying the taxes on the forgiven debt.

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