Posted on: 25th Feb, 2008 04:32 pm
if you do a deed in lieu of foreclosure do i get a 1099 for the money that i refinance on that property?
Hi Tuencanto,
Welcome to the forums.
You might get the form but that doesn't mean that you'll have to pay tax on any unpaid debt which is canceled by the lender. The form may be given just to keep a written record of the fact that some amount of the debt has been canceled.
However, the situation of cancellation of debt is not common in case of deed-in-lieu because in this case, the lender generally does not ask for the deficiency, if any between the unpaid debt and sale price.
Refer to a previous discussion on Getting 1099-C Form after deed-in-lieu .
Take Care
Welcome to the forums.
You might get the form but that doesn't mean that you'll have to pay tax on any unpaid debt which is canceled by the lender. The form may be given just to keep a written record of the fact that some amount of the debt has been canceled.
However, the situation of cancellation of debt is not common in case of deed-in-lieu because in this case, the lender generally does not ask for the deficiency, if any between the unpaid debt and sale price.
Refer to a previous discussion on Getting 1099-C Form after deed-in-lieu .
Take Care
Hi Tuencanto,
Welcome to the forum.
I agree with Sara. Generally the lenders do not want a deficiency judgment if you go for a DIL. So if your debt is forgiven by the lender then it will be considered as your income and you will be sent a 1099-C form and have to pay tax on it.
Feel free to ask if you have any further questions.
Best of luck,
Larry
Welcome to the forum.
I agree with Sara. Generally the lenders do not want a deficiency judgment if you go for a DIL. So if your debt is forgiven by the lender then it will be considered as your income and you will be sent a 1099-C form and have to pay tax on it.
Feel free to ask if you have any further questions.
Best of luck,
Larry
My Mortgage company told me that I may get a 1099 for the whole amount
of the toal balance owed on the house not after sale, but before sale and
if it does not sale, does that sound right?
Thank you,
Rhona
of the toal balance owed on the house not after sale, but before sale and
if it does not sale, does that sound right?
Thank you,
Rhona
Once they complet the deed in lieu process the lender will probably send you a 1099C at the beginnign of next year. That when you file your taxes