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jrjr125125
Mar 24, 2010, 08:39 PM
I received a 1099-a. box 4 is more than box 2. do I owe the differnce in taxes. When I purchased the house in 2006 at the height of the market the fmv came in at 156,000 , I paid 146,000. Box 2 now states 143,000 / box 4 now states 153,000. What is my situation in this matter. Any help would be greatly appreciated.

ebaines
Mar 25, 2010, 08:17 AM
No, you do not owe taxes and you do not need to worry about this form. It's for your information only. The bank wrote off $143K in principal on your mortgage (box2) and in return they got a property actually worth $153K (box 4). So the bank came out OK, and did not actually have to forgive any of the loan. Meanwhile you effectively sold the prperty to the bank for $143K, which is less than your purchase price of $146K, so you do not have a capital gain on this. Hence nothing here to report on your taxes.