FORECLOSURE, REAL ESTATE SHORT SALE & DEBT RELIEF

Much like the Dot.com problems of the past many individuals either are or know someone suffering through this terrible crisis.  No only do you lose you home through foreclosure or a short sale but you then may face a taxable event.

When a lender “forgives” the liability you owe them you may currently either face a lawsuit or debt forgiveness.  If you are sued by the lender you should immediately consult an attorney.  If however, you are relieved of your debt the lender may issue a form 1099C.  This form will include the amount of debt forgiven and the amount they sold the home for.  According to current IRS code this amount maybe taxable and will need to be included on your tax return.  We are experienced and knowledgeable about this aspect of the code.  It is possible to eliminate the income taxes due on this forgiveness.  If you are someone you know is or has been involved in this please give us a call immediately.

* Note: There is current legislation which may eliminate the taxability of this income however until this is passed by the Senate and the president you should contact us to discuss this matter.  A lot of legislation is never passed and we feel it is best to be prepared in the event this does not become law.