Posted on: 27th Jan, 2010 07:52 pm
my husband and were received a bankruptcy discharge September 2008, which included a home loan. They foreclosed on us the following year, per our attorney this is "normal" becuase even though we had no mortgage any longer due to the bankruptcy, they still need to foreclose to take the property back. It was foreclosed on September 2009 and now, Jan 2010 we have received a 1099-A form stating that the balence was 84,516 and the FMV was 50,000 and box #5 states "yes" we are are liable for the repayment of the debt. What does this mean? is this an error? I thought the bankruptcy cleared it all away. How does this affect how I need to do my taxes this year? HELP!!!
We live in Oregon. Our home was foreclosed on in 8/2010 (there was an auction date, but the paperwork we received later said our mortg. co. was the 'owner' so I assume a private party did not buy the house at auction). We just received a 1099-A. It shows our debt amount as $135,000. and the FMV as $160,000. and box 5 is marked yes.
What does this mean? Do we have to claim the difference as a gain/income on our taxes this year? And what happens if the lender sells the house for more than what our debt was?
What does this mean? Do we have to claim the difference as a gain/income on our taxes this year? And what happens if the lender sells the house for more than what our debt was?
Welcome Debchase,
The figures mean that the fair market value of the property was greater than the debt amount. If the lender sold off the property for the FMV, then he will gain a profit which will be given back to you.
Box 5 of the form states that you will be personally liable for the deficient balance. This will come into affect if the property was sold off at an amount less than the debt that you owed.
The figures mean that the fair market value of the property was greater than the debt amount. If the lender sold off the property for the FMV, then he will gain a profit which will be given back to you.
Box 5 of the form states that you will be personally liable for the deficient balance. This will come into affect if the property was sold off at an amount less than the debt that you owed.
The form indicates that I am NOT personally responsinle for the repayment of debt. What's up here?
Hi Billfitz!
Welcome to forums!
If you're not personally liable for the debts, then it means that the lender has forgiven your debt. In such a situation, the IRS will consider the forgiven debt as your income. However, depending upon the Mortgage Debt Relief Act, you won't have to pay taxes on the forgiven debt.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
If you're not personally liable for the debts, then it means that the lender has forgiven your debt. In such a situation, the IRS will consider the forgiven debt as your income. However, depending upon the Mortgage Debt Relief Act, you won't have to pay taxes on the forgiven debt.
Feel free to ask if you've further queries.
Sussane
i think i should use schedule d but there is no examples if no exemption as i only lived old house 1 1/2 years- all examples are if you qualify-- how do schedule d.
i bought a house in nov/2006 but couldnt get rid of old house-filed chapt 7 bankruptcy-aug11,2009--bank finally forclosed-march25,2010,sale june28,2010
box1= aug4/2010 (-thats wrong they can use acquisition date) box 2=46k, box4=65.5k box5=no
on my 2008 state return for 2007 i said i was a full time resident of new house state so that means my primary home was only approx 1yr and half of the 5 years- right? is there some way still claim old house primary?
i cant remember if received a 1099 on the chapt7 but in any case did not put it on my return last year for 2009 did not itemize and felt it didnt matter
i cant find what forms to use when not liable and box4 is greater than 2.
also i dont know what to put as cost as i bought the house from private indiv and than refinance and then loan modification in jan 200746.8k the only improvments was garage door and new roof and 10k in windows that i filed bankruptcy on and they didnt repossess.
i bought a house in nov/2006 but couldnt get rid of old house-filed chapt 7 bankruptcy-aug11,2009--bank finally forclosed-march25,2010,sale june28,2010
box1= aug4/2010 (-thats wrong they can use acquisition date) box 2=46k, box4=65.5k box5=no
on my 2008 state return for 2007 i said i was a full time resident of new house state so that means my primary home was only approx 1yr and half of the 5 years- right? is there some way still claim old house primary?
i cant remember if received a 1099 on the chapt7 but in any case did not put it on my return last year for 2009 did not itemize and felt it didnt matter
i cant find what forms to use when not liable and box4 is greater than 2.
also i dont know what to put as cost as i bought the house from private indiv and than refinance and then loan modification in jan 200746.8k the only improvments was garage door and new roof and 10k in windows that i filed bankruptcy on and they didnt repossess.
box 2 say bal of principal outstanding $51,641.65. Box 4 says 57971.70. Box 5 say was borrower personally liable for repayment of the debt? No What does this mean
Hi!
Welcome to forums!
To markcon,
I will suggest you to contact a tax adviser and take his opinion in this matter. He will check the whole matter and let you know what forms you need to submit.
To Tsues,
As far as I can understand, the lender has forgiven the deficient balance resulting from the property sale. Thus, you'll receive a 1099c form from the lender which you need to attach with your tax documents. You will be liable for paying taxes for the forgiven amount as it will be considered as your income.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
To markcon,
I will suggest you to contact a tax adviser and take his opinion in this matter. He will check the whole matter and let you know what forms you need to submit.
To Tsues,
As far as I can understand, the lender has forgiven the deficient balance resulting from the property sale. Thus, you'll receive a 1099c form from the lender which you need to attach with your tax documents. You will be liable for paying taxes for the forgiven amount as it will be considered as your income.
Feel free to ask if you've further queries.
Sussane
Should I include the box 2 or box 4 of the 1099A in my total income .
What other forms do I need to submit?
Should I or not include in the total income for 2010
What other forms do I need to submit?
Should I or not include in the total income for 2010
Hi gurgur,
You should contact a tax adviser and show him/her the documents. He or she will check the documents and let you know what documents you need to file and what you should include in your total income.
Thanks
You should contact a tax adviser and show him/her the documents. He or she will check the documents and let you know what documents you need to file and what you should include in your total income.
Thanks
I received my 1099 A and box 4 is more than box 2 does this mean I won't have to pay taxes on this? What if I haven't received a 1099 C, do I need this to file my 2010 taxes or do I just enter the amounts that are indicated on 1099 A on the applicable tax form. What is the applicable tax form for this situation?
Hi Guest,
Unless you receive the 1099c form, you won't be liable for paying taxes. The lender will send you the 1099c form if he has forgiven your debts. If you're liable for paying off the deficient balance resulting from the sale of the property, then you won't have to pay any taxes regarding that debt.
Unless you receive the 1099c form, you won't be liable for paying taxes. The lender will send you the 1099c form if he has forgiven your debts. If you're liable for paying off the deficient balance resulting from the sale of the property, then you won't have to pay any taxes regarding that debt.
I just wanted to thank you for posting and having this site. I have been trying for weeks to figure out what to do with this 1099A since we did the deed in lieu and never reaffirmed the debt from bankruptcy. Thank you so much!
Hi Titlewoman,
You will have to attach 1099A form with your tax documents. You should contact a tax adviser and he will better guide you in this matter.
You will have to attach 1099A form with your tax documents. You should contact a tax adviser and he will better guide you in this matter.
if you receive a 1099a......will you always get a 1099c at some point..or can the bank not send one if they do not want to
Hi gregshully!
Welcome to forums!
You will receive the 1099c form only when your debts are forgiven by the lender/creditor. This will prove the fact the forgiven debt is a taxable amount as it will be considered as your income. If you pay off the balance dues, then you won't receive the 1099c form.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
You will receive the 1099c form only when your debts are forgiven by the lender/creditor. This will prove the fact the forgiven debt is a taxable amount as it will be considered as your income. If you pay off the balance dues, then you won't receive the 1099c form.
Feel free to ask if you've further queries.
Sussane