Posted on: 27th Feb, 2010 06:44 pm
i had a home that was foreclosed on the balance n the sale price was a difference of almost 58,000.00 that i still owe how will that effect my taxes negatively are postively
Hi julie,
If there has been a difference of $58,000 between the sale price and the outstanding balance on the loan, you will be liable to pay it off. The mortgage. If the lender forgives this difference and sends you a 1099-C form, you need to report this income from the discharge of debt to the IRS. However, if you used the property as your primary residence, you can claim exemption from paying taxes under the Mortgage Forgiveness Debt Relief Act, 2007. You will have to fill out form 982 and send it along with your tax return to claim this exemption.
If there has been a difference of $58,000 between the sale price and the outstanding balance on the loan, you will be liable to pay it off. The mortgage. If the lender forgives this difference and sends you a 1099-C form, you need to report this income from the discharge of debt to the IRS. However, if you used the property as your primary residence, you can claim exemption from paying taxes under the Mortgage Forgiveness Debt Relief Act, 2007. You will have to fill out form 982 and send it along with your tax return to claim this exemption.