Posted on: 08th Dec, 2010 11:16 am
State of Florida, investment condo being approved for a DIL. Should be done before end of this year. If I owe $185k, and fair market value is 40k, then I have a tax liability for $146k to the IRS? If considered as ordinary income by the IRs, i would have to come up with $29.2k? this is insane. If I had that kind of money, I'd still be making payments on the condo. That being said, can I file the request for a settlement with the IRS on this debt, or do I need a lawyer to do it?
Hi fruggi,
If the lender forgives the deficient balance resulting from the property sale, then you will be liable for paying the taxes for the forgiven debts to the IRS. You can always file a settlement with IRS and try to get a payment plan to pay off the taxes.
If the lender forgives the deficient balance resulting from the property sale, then you will be liable for paying the taxes for the forgiven debts to the IRS. You can always file a settlement with IRS and try to get a payment plan to pay off the taxes.