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    IWANNAKNOW's Avatar
    IWANNAKNOW Posts: 7, Reputation: 1
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    #1

    Jan 23, 2008, 01:18 PM
    What does a 1099-A mean
    I received a 1099-A for a timeshare property that I quit paying on after I became disabled earlier last year(07).My question is how will this affect my taxes. Box 2 showing outstanding principal & box 4 showing fair market value are the same. Does this constitute a wash and there is no tax due or what? I am currently living in Georgia and my only source of income is disability benefits.

    Thank you in advance for your replies.
    ScottGem's Avatar
    ScottGem Posts: 64,966, Reputation: 6056
    Computer Expert and Renaissance Man
    		  
    #2

    Jan 23, 2008, 01:26 PM
    It means that the lender has forgiven the debt essentially making a gift to you of the balance. So you have to pay taxes on it.
    IWANNAKNOW's Avatar
    IWANNAKNOW Posts: 7, Reputation: 1
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    #3

    Jan 23, 2008, 02:34 PM
    Quote Originally Posted by ScottGem
    It means that the lender has forgiven the debt essentially making a gift to you of the balance. So you have to pay taxes on it.
    Since the debt has been "forgiven" and they are giving me a tax bill for it, does this mean that I now owe the property?
    ScottGem's Avatar
    ScottGem Posts: 64,966, Reputation: 6056
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    #4

    Jan 23, 2008, 05:57 PM
    No. It means they reclaimed the property and took a loss on the balance owed. That's what the 1099-A amount is.
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
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    #5

    Jan 24, 2008, 08:51 AM
    Scott has explained it well.

    Claim the additional income on Line #21 of Form 1040.
    IWANNAKNOW's Avatar
    IWANNAKNOW Posts: 7, Reputation: 1
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    #6

    Jan 25, 2008, 10:24 PM
    Thanks for your replies.
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
    Senior Tax Expert
    		  
    #7

    Jan 27, 2008, 08:47 PM
    Glad to help!
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