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    dross1's Avatar
    dross1 Posts: 1, Reputation: 1
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    #1

    Feb 21, 2008, 07:43 AM
    Will I have to pay taxes if I receive a 1099 from my short sale?
    I am plainning to refinance my home and my mortgage company offered a "short payoff" in which I will receive a 1099 at the end of the year. Will I be required to pay taxes on this money?
    ebaines's Avatar
    ebaines Posts: 12,131, Reputation: 1307
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    #2

    Feb 26, 2008, 09:03 AM
    Yes - any income shown on a 1099 must be reported to the IRS. If your bank is forgiving some of your debt, they are in effect making a gift to you, and this must be reported as income.
    RICKYLANDRY's Avatar
    RICKYLANDRY Posts: 16, Reputation: 0
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    #3

    Feb 26, 2008, 02:43 PM
    Yes you will have to pay taxes on this forgiven debt because any income that is
    Claimed on a 1099 taxes have to be paid on it
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