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

    Jan 23, 2010, 03:59 PM
    Do I have to report my 1099-A on my taxes if the property was discharged in a bankrup
    Do I have to report my 1099-A on my taxes if the property was discharges in a bankruptcy?
    ebaines's Avatar
    ebaines Posts: 12,131, Reputation: 1307
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    #2

    Jan 25, 2010, 08:18 AM

    Probably not. The 1099-A form is just for your informaton. Take a look at the Fair Market Value box and compare it to the Balance of Principal - if the FMV is larger then this means the bank didn't lose any principal on the loan, so you would have no income to report from it. If the FMV is less than the principal outstanding, then you can expect a 1099-C that will report the difference as income to you.

    If you do receive a 1099-C, you may be able to avoid having to pay tax on the forgiven amount of debt by attaching Form 982 with your tax return. See here for details:
    http://www.irs.gov/pub/irs-pdf/p4705.pdf
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