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FiveStarLaw
FiveStarLaw, Tax Attorney
Category: Tax
Satisfied Customers: 36606
Experience:  25 years of experience helping people like you.
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If we do a deed in lieu of foreclosure with a bank on a property

Customer Question

If we do a deed in lieu of foreclosure with a bank on a property that is standing for collateral on a loan will the bank send us a 1099 showing the loan amount as income to us?
Submitted: 2 years ago.
Category: Tax
Expert:  FiveStarLaw replied 2 years ago.
*This chat is not intended as legal or tax advice. It is general information that may or may not apply to your situation and should not be relied upon

Is the property your primary residence?
Customer: replied 2 years ago.

No. This property is a real estate office and 3 rental properties combined
into collateral for the one loan.


 

Expert:  FiveStarLaw replied 2 years ago.

Hello,

 

Thank you for your response. Although I am a lawyer, my answers are information only and do not form an attorney/client relationship.

 

I will do my best to provide you with helpful information. If the information which I provide is not clear to you or does not fully answer your question, please ask me for clarification by using the reply button.

 

 

The lender will send a 1099 to all borrowers in the amount of the forgiven debt. Typically this would be taxable as ordinary income

 

 

I think this is what you wanted to know. Please let me know if I have answered your question or whether you would like further information...but please do not shoot the messenger.

FiveStarLaw, Tax Attorney
Category: Tax
Satisfied Customers: 36606
Experience: 25 years of experience helping people like you.
FiveStarLaw and 7 other Tax Specialists are ready to help you
Expert:  FiveStarLaw replied 2 years ago.

Thank you very much for the positive rating and the bonus!

If I can be of assistance in the future, begin your question with: "For FiveStarLaw"

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