Hello,
This is in California.
My former principal residence was purchased in 2007 and we lived there until 2014 when we moved out into a rental condo. The home was subsequently foreclosed on in 2015. There were two lenders on the loan and both loans were used SOLELY to purchase the property. We never saw a dime at closing - all monies passed directly from lenders to the seller.
The foreclosure wiped out the junior in the process. We received a 1099-C from the senior which said that we were not personally liable to repay the loan. However, the 1099-C from the junior says that we are personally liable to pay back about $100,000 ! This has come as a great shock to us, as we believe that we may owe income tax on this "income" of $100,000 ?To make matters worse, we had already filed our taxes for 2015, and now this.
Please help. Are we going to have owe thousands of dollars on income ? Do we amend our income tax to reflect this ? We don't want any trouble with the IRS, we just want to move on and rebuild our lives after that disaster.
Thank you for your time and advise.
This is in California.
My former principal residence was purchased in 2007 and we lived there until 2014 when we moved out into a rental condo. The home was subsequently foreclosed on in 2015. There were two lenders on the loan and both loans were used SOLELY to purchase the property. We never saw a dime at closing - all monies passed directly from lenders to the seller.
The foreclosure wiped out the junior in the process. We received a 1099-C from the senior which said that we were not personally liable to repay the loan. However, the 1099-C from the junior says that we are personally liable to pay back about $100,000 ! This has come as a great shock to us, as we believe that we may owe income tax on this "income" of $100,000 ?To make matters worse, we had already filed our taxes for 2015, and now this.
Please help. Are we going to have owe thousands of dollars on income ? Do we amend our income tax to reflect this ? We don't want any trouble with the IRS, we just want to move on and rebuild our lives after that disaster.
Thank you for your time and advise.
Federal Taxes: 1099-C Received on a Foreclosed Home
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