“1099” Debt Forgiveness

Posted on October 5, 2010

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Sometimes the lender will forgive the debt to the forecloser, (called a 1099) thus declaring a deductible loss that reduces their income tax. However, the tax can come back to bite the lucky mortgager.

If you have property foreclosed on, and the bank forgives the debt, you still should include the cancelled monies when doing your income tax. The amount you have received (or rather, do not have to reimburse the lender) is counted as income because you don’t have to repay it. The mortgagee must report the amount of the canceled debt to you and the IRS on a Form 1099-C, Cancellation of Debt.

 See Axsmith.net for more details.  Christine Axsmith, Esq. is a Washington, DC – based attorney specializing in foreclosure fraud, illegal foreclosure, real estate fraud.  Her credentials can be viewed at her LinkedIn profile.  The Axsmith Law website has a wealth of information for review related to elder law and foreclosure prevention. 

Other sources of valuable information are the AARP website, the Federal Trade Commission website and the HUD website.  See Axsmith Law web site to speak to an attorney.

www.axsmith.net
www.cnn.com
www.washingtonpost.com
www.huffingtonpost.net
www.foreclosure.com
Wikipedia on Foreclosure
HUD Foreclosure Prevention Programs
Foreclosure Houses – Get Your Name Off This List!
Foreclosure Misc
www.washingtonpost.com
www.huffingtonpost.net
www.foreclosure.com
Wikipedia on Foreclosure
HUD Foreclosure Prevention Programs
See more guardianship information at http://www.axsmith.net/Washington_DC_Guardian_Attorney.html

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