Posted on: 02nd Feb, 2010 07:50 pm
I had a time lease for 5 years, and used it twice (total of two weeks).
I had to file bakruptcy(chapter 7). Which covered the time lease.
I recieved a 1099-A which included a bal. of pricipal and fair market value.
How does this effect my tax return?
I had to file bakruptcy(chapter 7). Which covered the time lease.
I recieved a 1099-A which included a bal. of pricipal and fair market value.
How does this effect my tax return?
Hi olddawgg,
Lenders send you 1099A form for acquisition and abandonment of secured property. They are required to do this as they have to report the cancelled debt to the IRS. But as you filed bankruptcy Chapter 7, your debts have been discharged. You are no longer liable for the debt. If there was deficiency from the foreclosure sale of the house and if it was discharged through bankruptcy, you will not have to pay any tax on the discharged debt.
Lenders send you 1099A form for acquisition and abandonment of secured property. They are required to do this as they have to report the cancelled debt to the IRS. But as you filed bankruptcy Chapter 7, your debts have been discharged. You are no longer liable for the debt. If there was deficiency from the foreclosure sale of the house and if it was discharged through bankruptcy, you will not have to pay any tax on the discharged debt.