 |
|
| Browse | Ask | Answer | Search | Join/Login |
|
|
||||
|
Foreclosure-1099
1099-A . I'm a Canadian who had 2 rental condos in Nevada, Foreclosed by GMAC in Jan 2010. I have just received 4 (1099-A) 2 in my name and 2 in wife's name from GMAC for the same properties.We are joint tenants. What is our tax obligation and is there an exemption form for non-resident?
|
||||
|
||||
|
The 1099-A is generally sent to you for your information purposes only - if you actually needed to report any income due to the foregiveness of the loan they would send you a 1099-C. But to be sure: if the amount shown in box 2 (principal of the loan outstanding) is LESS than box 4 (fair market value of the property), then in essence you sold your property to the bank for less than it was worth, and there is nothing to report with respect to foregiveness of the loan. However, given that these were rental properties, and assuming that you may have been taking depreciation on them over the years, it's possible that you may have a capital gain to report for this "sale." |
||||
|
||||
|
Normally I would expect the lender to issue you a 1099-C, as they definitely cancelled debt ($100K loan was settled by foreclosing on a property worth only $50K). However, if you declared bankruptcy or insolvency the foregiveness of the loan is not taxable. Further, because this was a business property there are complications over how to report the foreclosure that will come into play. You should read pub 4681for details: http://www.irs.gov/pub/irs-pdf/p4681.pdf |
||||
|
||||
|
Actually through 2012 most US residents who lose their primary homes to foreclosure don't have to pay taxes on the debt foregiveness (unless it's more than $2 million). But those who lose a second home or have other types of debt foregiven - like cedit cards or business debt - do, unless they have declared bankruptcy. I think using a professional on this is indeed a wide move. |
||||
| Question Tools | Search this Question |
Add your answer here.
Check out some similar questions!
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...
What is the tax rate on the 1099 c foreclosure
My mother passed away four years ago and we couldn't sell her house. We could not make the payments on it any more so we sent it into foreclosure. Why do we have to file a 1099c? The home was still in my mothers name. She bought the house for $118,000 and the bank sold it for $40,000. What tax...
My wife and I lost a second home to foreclosure. Should we be expecting a 1099 for the balance that was still owed after the sale.
This past year I had a foreclosure on my primary residents. I have not claimed bankruptcy. I received a 1099-A from my bank, and they are telling me that I probably will not receive a 1099-C from this. The amount owed to lender is about 10k more than the fair market value. I know that there is a...
View more questions Search
|
