Posted on: 10th Sep, 2009 08:02 am
We are considering short selling our primary residence. We owe $300K and the real estate agent says that comp's in the area are going for about $130K. Would I have to show as taxable income the difference and have to pay taxes on this amount?
If it is your primary residence then you will not pay taxes on the deficient amount
Hi krh,
In case of a short sale, the deficient amount resulting from the sale of the property is not forgiven by the lender. You will have to repay it to him. In case, if the lender forgives the deficient amount, then depending upon the Mortgage Debt Relief Act, taxes would be forgiven.
Thanks
In case of a short sale, the deficient amount resulting from the sale of the property is not forgiven by the lender. You will have to repay it to him. In case, if the lender forgives the deficient amount, then depending upon the Mortgage Debt Relief Act, taxes would be forgiven.
Thanks