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    Bamboozled1's Avatar
    Bamboozled1 Posts: 2, Reputation: 1
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    #1

    Jan 25, 2010, 05:39 PM
    1099a
    I received a 1099A with principal loan bal of $351,000.00 and FMV$378,204.00. It was purchased with a primary res. Loan. It shows borrower personally liable for repayment of debt. House is in Oregon. I move into it for several months and was unable to live there for health reasons and moved back to my original residence. I see a $27,000.00 difference in value. Will I owe taxes or what?
    ebaines's Avatar
    ebaines Posts: 12,131, Reputation: 1307
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    Jan 26, 2010, 07:19 AM

    No - you don't owe any income tax on "debt forgiveness" as the FMV was greater than the loan principal. This 1099-A form is for your information only. The only exception is if the principal loan balance that was forgiven - the $351K - is in excess of your purcase basis for the house. Under that scenario then it's possible that you have a reportable gain on the house (if you don't qualify for an exclusion of capital gains on your primary residence). This seems like an unlikely scenario.
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