Real Estate Mortgage Defaults, the IRS, and Real Estate Short Sales
Cancellation of debt could be a concern for people who have defaulted on their home mortgage.
The bank holding your mortgage is required to file with the IRS Form 1099–C, Cancellation of Debt (COD), reporting the amount of COD to be included on the individual’s tax return. The COD amount may include unpaid principal, accrued interest, penalties, and attorney fees. If you are insolvent under state law when you default, the amount of COD is not considered income. If you are working on a SHORT SALE, negotiate with the lender to waive the filing altogether. I am not a CPA, so please check with your advisors.
In the Ann Arbor Real Estate Market, many great people are finding themselves in this situation. We have a packet of information you can review if you want to be informed. If you or someone you know finds yourself in this spot, we’d be grateful if you’d let them know about us. We promise to provide them with THE best and caring professional services.
We have an immaculate short sale on Island Lake Rd (click here for details) in Chelsea, MI 48118 for $159,000 that has preliminary bank approval…we just need a pre-approved buyer to take advantage of this deal.
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Kathy Toth and Team Real Estate One
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Kathy Toth and Team
www.KathyToth.com
Keller Williams Realty
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