Compare Mortgage Quotes

Refinance Rates for Today

Please enable JavaScript for the best experience.

In the mean time, check out our refinance rates!

Company Loan Type APR Est. Pmt.

1099A - Do you pay taxes if lender sends you this form?

iT SHOWS WHAT WE OWED AND WHAT THEY SAY WAS FAIR MARKET OR REALY WHAT IT SOLD FOR AT THE AUCTION. SO THE DIFFERENCE WOULD BE INCOME RIGHT? CAN I USE THAT AS A LOST ON MY INCOME TAX FOR MY HOME? NEED HELP

larry2's picture
larry2 | Joined: June 27, 2007 02:50 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi lindaplus,

I think you should consult with a tax assessor.

BTW losses on acquisitions or abandonment of property which is held for personal use are not deductible.

Best of luck,
Larry

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Samantha's picture
Samantha | Joined: September 16, 2005 11:59 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi,

A tax assessor won't be the right person here. Instead, it has to be a tax advisor with whom you should consult if required.

The deficiency that is difference between the loan balance and the sale price should be paid off within a time period. In case you can't, it won't be taxed as per the Mortgage Debt Forgiveness Tax Relief Act . So, you need not worry about the taxes on the canceled debt.

Even if the form 1099A shows it as your income, that is, just for reporting to the IRS. You will have to file your taxes with the form 1099A and then you'll get a deduction on the whole.

Hope this helps...

God bless you.

Samantha

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

girlndebt's picture
girlndebt | Joined: February 2, 2008 02:42 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

There are so many loopholes in this whole Mortgage Debt Forgiveness Tax Relief Act. It could be a blessing for most of us and for some it makes no difference. If money is tight, look for someone who can give you a free consult. Depending on your situation even if you do not qualify under the new law, you may be able to prove insolvency. I am not at all a tax expert. I have been researching this for months now. I sold my home through a short sale and my lender never sent me a 1099. I have been searching for answers but I will have to speak to a professional as well.

I usually file our taxes every year using TurboTax. This year though may be different. I see no forms on there that would pertain to these problems.

Best of luck to you.

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

jameshogg's picture
jameshogg | Joined: December 20, 2005 02:58 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

[quote:ee027601ad]There are so many loopholes in this whole Mortgage Debt Forgiveness Tax Relief Act[/quote:ee027601ad]
Hey girlindebt, I don't find loopholes, the only thing being in doubt is, whether it will continue after 2009. what loopholes do you see here?

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

girlndebt's picture
girlndebt | Joined: February 2, 2008 02:42 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

The bill only applies to a “principal residence”. Investment properties and second homes in a short sale situation are not going to be eligible. So [u:ff77180207]what does the IRS consider a "principal residence[/u:ff77180207]"? The answer is tricky. I know in my case, I lived in the house less than 5 years...actually less than 2. It was my primary residence and not a second home or investment property. Maybe it is just me and I am not getting it but when I called the IRS the other night, I had to go through a "worksheet" to figure this out. They calculated the months I lived there and then went over the reasoning I had to sell my house. Based on my answers, I was told to file a form claiming I was insolvent and I wont be responsible for the taxes. Why do I need to go through all of that? Wouldn't that new law pertain to me?

Again, I am no accountant and maybe I could be reading this all wrong but this is very confusing.

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

sara's picture
sara | Joined: July 5, 2006 03:16 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi Girlindebt,

Under the IRS rules, only a primary residence can qualify for Mortgage Debt Forgiveness Debt Relief. As per the IRS rules, a primary residence is one in which the owner should have 2 years of ownership and occupation or 730 days. But this need not be concurrent. There can be short vacations but that will be considered as period of use. However, 1 year of stay out of the home won't be counted as period of use or occupation.

Since you've not stayed there for complete 2 years, probably that's the reason the IRS suggested that you'll have to pay taxes. Besides, there are other conditions under which one can get tax relief on canceled debt. These are:

  1. The debt should have been canceled by the lender in the years 2007 through 2012.
  2. The debt should have been taken to buy, build or improve a principal residence. Second homes, rental property or vacations homes are not applicable here.
  3. The tax relief is limited to debt amount of $2 million.
  4. The forgiven debt related to cash-out [url=http://www.mortgagefit.com/refinance.html]refinance[/url] or [url=http://www.mortgagefit.com/home-equity.html]home equity loan[/url] is divided between the amounts required for buying, building, improving home and amounts used for purposes like tuition, payments of other debts, etc. The allowable portion for tax break is then calculated.

So, yes, there are loopholes which are evident from the conditions stated above.

Take Care

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

wealthbuilder2's picture
wealthbuilder2 | Joined: March 1, 2008 12:44 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

Unfortunately, a 1099M is like a W-2, it is a report of income for which you owe income taxes.

The IRS considers money that you were obligated to pay and did not, the sale was short of the total that was owed, as income and they demand that you pay taxes on the amount that was short paid in cash with your next tax return.

Now, the Mortgage Relief Act of 2007 relieves certain people of this absurd burden. Depending when your sale occurred; it only applies to the years 2007-2009, and if it was your primary residence in which you lived in at least 2 out of the last 5 years, you may be exempted.

I say maybe because if you did a cash out refinance, the money that you did not use to improve the house, that you spend on wine, men and song, would still count against you.

If the house was not your primary residence, you get no relief. Your only out would have been to have declared bankruptcy prior to the sale.

Hope this helps.

Bill

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Bill, you mean one has to file bankruptcy chapter 13 prior to the sale so that he need not pay tax on the canceled debt, provided he's does not qualify for mortgage debt forgiveness.

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

wealthbuilder2's picture
wealthbuilder2 | Joined: March 1, 2008 12:44 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

MAC_7

Correct!

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

WE HAVE RECD A 1099A FOR INVESTMENT PROPERTY IN WHICH OUTSTANDING BALANCE WAS FOR $436975.50 AND FMV IS $238,500. THE ORG LOAN AMOUNT IS FOR $370,000. WE SHOULD BE INSLOVENT DO TO LOST OF INCOME AND JOB FROM THE HOUSEHOLD. I ALWAYS HAVE STARTED THE PROCESS FOR BANKRCY BACK IN DEC 2008. I WANTED TO KNOW HOW WILL THIS CHANGE OUR TAXABLE INCOME? IF WE WIL HAVE TO PAY TAXES ON ANY OF THE AMOUNTS WHO MUCH WILL IT COULD BALLPARK FIGURE?

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

It will depend upon the type of bankruptcy you file. A bankruptcy attorney will be the best person to help you regarding this issue.

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

I lost my home to forclosure in 2008 and recieved a 1099-A form. The value of the hoem is less that what it shows I sold it for. Will I be taxed on this? Also being in MA will I be taxed by the state?

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Yes, you may have to pay capital gains tax for the sale of the property.

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

I went into foreclosure in 08, filed chapter 7 in 08, discharged in 09 - house still sits empty...should I expedite and do dil...or let it run its course? home was in bk...but worried I may still be financially responsible..taxes...and HOA...I abandon the home before discharge.
please give me some direction...my bk attorney is not helpful

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

adonis's picture
adonis | Joined: October 22, 2005 05:04 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi katie,

You have mentioned that your property foreclosed in '08. If that is the case, then you will not be responsible for the property anymore as the lender might have sold the property and recovered the dues.

But, in case, you filed bankruptcy before the property was foreclosed, then did you reaffirm the mortgage?

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

FMV is 15k over balance on 1099-a. Bought in 05, bank aquired in 08. No 1099-C. Is the 15K forgiven?

What do I file the sale price as, the balance or FMV? Basis was 220K.

This is one confusing form and answers all over the place.

Thanks in advance

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

I was liable for the debt

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

jameshogg's picture
jameshogg | Joined: December 20, 2005 02:58 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi shack,

As you did not receive a 1099-c, your debts were not forgiven by the lender. The sale price is the amount for which your lender sold off the property. If you are facing problems in filling out the form, you can contact your tax consultant and he will help you in filling out the form.

Thanks

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

I have lived in my home for 10 years but I just can't afford it. The house compares to 185k to 190k and I owe 270k. I live in California. How long does it take to be asked to leave? I need to save up money to have so I can rent. I have stopped making the mortage payment so I can save up the money so I can have a roof over my head. Countrywide did me no favors and it is walk away from this house or loose it in a year.
I refianced for fixer up money on this house but I do not have any receipts.

What are the tax implications and how long can I stay in the house .

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

smith.sussane's picture
smith.sussane | Joined: September 18, 2008 09:57 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi guest!

Welcome to forums!

The lender can foreclose the property if you do not pay the mortgage dues for more than 3 months. If you want to save the property, you can apply for a loan modification. However, if you do not want to save the property, then walking away from the property can be a good option as in California, the lender will not be able to sue you for the deficient amount. As far as the taxes on the forgiven amount is concerned, you may not have to pay them depending upon your state laws.

Feel free to ask if you have further queries.

Sussane

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Do anybody know if a lender (2nd mortgage holder) can sue for deficient amount in Florida after a short sale ? This is assuming the 2nd mortgage debt wasnt completely forgiven at closing. I know this varies from state to state so I was just wondering about Florida in particular. Thanks.

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

adonis's picture
adonis | Joined: October 22, 2005 05:04 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi ChrisN,

The [url=http://www.mortgagefit.com/second-mortgage.html]second mortgage[/url] lender can sue you for the deficient amount resulting from the short sale of the property. If you're unable to pay the deficient amount, the lender may place lien on your other properties.

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Ch 7 discharge Nov 2008, first & second mortgage both not reaffirmed, to avoid taxes, is it better to do a [url=http://www.mortgagefit.com/deed-lieu.html]deed in lieu of foreclosure[/url], or better just to walk away? Basis is $160k, loans about $800k. Married.

Thanks!

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

adonis's picture
adonis | Joined: October 22, 2005 05:04 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

You can apply for a deed in lieu foreclosure in order to get rid of the property. As you've not reaffirmed the debt, you are not personally liable to pay off the debts. The lender only be able to recover the collateral from you. He will not be able to sue you for the deficient amount. However, this would lower your credit score by around 250 points.

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

If I short sell my investment property and Bank has the option to pursue the remainder of the balance due on their loan, can this be discharged in [url=http://www.mortgagefit.com/bankruptcy/chapter7.html]Chapter 7 Bankruptcy[/url]? IL

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

jameshogg's picture
jameshogg | Joined: December 20, 2005 02:58 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi Joanneliza,

As far as I know, the deficiency balance resulting from the short sale of the property would be considered as your unsecured debt. So there are chances that this would be discharged if you file Chapter 7 bankruptcy. However, it would be a better option if you could consult a bankruptcy attorney and take his opinion in this regard.

Thanks

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

When I was going through with my Deed in Lieu Countrywide told me that the price of the house would be the fair market value listed on the 1099. After my Deed in Lieu went through I seen several months later my place sold for way less than the fair market value. When they send my 1099 will they have to list the fair market value on it like they said or can they put the selling price on there?

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

adonis's picture
adonis | Joined: October 22, 2005 05:04 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi Bugger,

As far as I know, the lender will list the fair market value of the property in the 1099 form and not the selling price.

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

If I have an investment property (never lived in the home) and am being offerred a DIL by the lender, (looks like we will be approved for this) would this be a better opion than going through full foreclosure and what are my tax implications (IRS) if I take th DIL deal?

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

smith.sussane's picture
smith.sussane | Joined: September 18, 2008 09:57 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi Betsey!

Welcome to forums!

It is a better option to go for a deed in lieu of foreclosure rather than letting the lender foreclose the property. Your deficient balance will be forgiven by the lender. Depending upon the state laws you'll not have to pay any taxes on the forgiven amount.

Feel free to ask if you've further queries.

Sussane

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

If we ask for a deed in lieu of foreclosure, are we freed from the debt of the mortgage and of the [url=http://www.mortgagefit.com/home-equity.html]home equity loan[/url]?

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

jameshogg's picture
jameshogg | Joined: December 20, 2005 02:58 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi Guest,

If there are two loans on your property, then I don't think the sale of the property would recover both the mortgages. In that case, you will have to pay off the second loan. However, you won't have to pay anything on the first loan. Even if there is a deficient amount on the first mortgage, it would be forgiven by the lender.

Thanks

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

MAC:

That is actually INCORRECT. You do not have to file a Chapter 13 to get rid of that debt and you do NOT have to file it before the debt occurred.

Chapter 7 will get rid of it as well. AND, usually, you can file on it after the sale. At my job we like to tell people that it is probably BETTER to file the bankruptcy before the finalization HOWEVER you do not have to.

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

I received a 2009 1099-A "Acquisition or Abandonment of Property." The existing balance of the loan is higher than the FMV. Do I have to file anything with the IRS this year? Please help.

Thanks

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

3 yrs ago we purchased our son's home as a non-owner occ when his current loan was an ARM and he became ill and was unemployed. 5 months ago our son passed away and being in our 60's we cannot afford to make the payments. The last payment we made was Sept. Our loan is a Fannie Mae and there is a govt freeze on foreclosing at this time. The home is in Washington State.... which would be the best way to go to avoid paying back a deficiency? Our loan is $270,000 and assessed value is $199,000 with homes here selling for under assessed value. Thanks

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

smith.sussane's picture
smith.sussane | Joined: September 18, 2008 09:57 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi!

Welcome to forums!

To Ann,

Your query has been replied to in the given page:
http://www.mortgagefit.com/annoucements/about35279.html#152162

Take a look at it. Hope it helps you.

To Jan,

You should apply for a deed in lieu of foreclosure with your lender and try to sell off the property. You won't be liable for the deficient balance if the lender accepts your request.

Sussane

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

I did received a 1099A. box (1) 196,000.00, and box (2) 210,000.00
was an investment proterty.
According to what I read I do not have to reported anything right?
I still do not have the 1099C. It was florclosure in july

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

smith.sussane's picture
smith.sussane | Joined: September 18, 2008 09:57 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi jcaal!

Welcome to forums!

You would receive the form 1099c only when your deficient balance resulting from the sale of the property has been forgiven. I guess, the deficient balance in your case hasn't been forgiven by the lender. Thus, you are responsible to pay it off.

Sussane

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi,
2006 I purchased my principal property for $712K put down payment of $143K and with a principal balance of $569K, I lived over a year and rented for 6 months, it was foreclosed 10/09 and the sold it for $360,000 in 12/09, a month ago my lender send me 1099-A form on box 4 the fair market value of my property was only $25K.Am I liable for repayment of debt? or cancellation of debt. Please I need your advise.
Thank you,
Angelo O

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

adonis's picture
adonis | Joined: October 22, 2005 05:04 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Welcome Angelo,

As the property has been foreclosed by the lender, you are liable for the payment of deficient amount resulting from the sale of the property. However, if the lender forgives the dues and sends you a 1099-c form, then you won't be liable to pay off the deficient balance. You need to speak to your lender and check out whether or not the deficient balance would be forgiven.

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

I did DIL in 1999 that states "THIS DEED IS AN ABSOLUTE CONVEYANCE, the consideration therefore being the satisfaction of all obligations secured by the Deed of Trust executed by: says my name" what happened was I got a letter from the IRS in May 2008 saying Citimortgage had sent them a 1099c for the year 2006 with a cancelled debt of $36,638.00 and are taxing me for it, my question is can they do that ? Is this correct ? It took them 7 yrs to send this 1099c to IRS (I never received one) when records show the house had sold in July 1999, Is there a statues of limitations?

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

smith.sussane's picture
smith.sussane | Joined: September 18, 2008 09:57 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi Allbatwings!

Welcome to forums!

After a deed in lieu, the lender forgives the deficient balance resulting from the sale of the property and sends a 1099c to the borrower. The forgiven amount is considered as the income of the borrower and thus, the IRS can charge taxes on that amount. As the lender has send the 1099c form after such a long time, I would suggest you to have a word with your attorney and then take a decision.

Feel free to ask if you've further queries.

Sussane

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

I filed [url=http://www.mortgagefit.com/bankruptcy/chapter7.html]chapter 7 bankruptcy[/url] in 2009 my mortgage was included, I chose to stay in my home but did not reafirm the dept. I paid 160,000.00 for my condo which is now worth 48,000.00. Now I am going to have to foreclose on my homw. Will I have to pay state taxes and if so about how much

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

jameshogg's picture
jameshogg | Joined: December 20, 2005 02:58 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi annie,

As you did not reaffirm your debts, the lender will not come after you for the deficient amount resulting from the sale of the property. However, this forgiven balance will be considered as your income and the IRS may charge taxes on that amount.

Thanks

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

I am the co-owner of a property that has gone into foreclosure. I haven't lived in the property for a year and a half, however the other owner remained in the home. The other owner has now filed Chapter 7 Bancruptcy and included the house. I want to do a Deed in Lieu b/c the property is still in my name and I cannot pay for it. What do I need to do, and what effect will it have on me.

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

adonis's picture
adonis | Joined: October 22, 2005 05:04 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi Guest,

The other owner will have the rights to include the property in his bankruptcy filing as it will be considered as his assets. As he has already filed bankruptcy and included it in his filing, I don't think the lender will now go ahead with your deed in lieu of foreclosure request. You will only be able to proceed further with deed in lieu once the other owner is discharged of bankruptcy.

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

How do I file this and what can I expect as for as being taxed on the cancelled prt of the form?

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

jameshogg's picture
jameshogg | Joined: December 20, 2005 02:58 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi Bonnie,

You can check out the given page in order to know the information related to 1099c form:
http://www.irs.gov/instructions/i1099ac/ar02.html#d0e196

The canceled portion of the unpaid debt is treated as your income by the Internal Revenue Service. You'll be charged taxes for that unpaid debt amount.

Thanks

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Our primary residence was lost after a job loss. It was March 2009 balance was 225,000. I never received a Form 1099 nor made any money at all on the transaction. Does it qualify for the Debt forgiveness Tax relief? How do I account for it on the Tax this year?
Pls help
Freeman's

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

smith.sussane's picture
smith.sussane | Joined: September 18, 2008 09:57 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi Freeman!

Welcome to forums!

If the lender has forgiven your debts, then you would receive a 1099c form from him. I don't think you would be able to claim the Debt Forgiveness Tax Relief unless you receive that form. I would suggest you to contact your lender and ask him to send you the form and then you would be able to claim the tax relief.

Feel free to as ask if you've further queries.

Sussane

Like | Dislike | Share | Posted: Fri, 02/05/2016 - 00:38 | Post subject:

Page loaded in 0.145 seconds.