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William Ellis, CPA
William Ellis, CPA, CPA
Category: Tax
Satisfied Customers: 296
Experience:  Over 15 years of experience in public accounting
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I am getting ready to foreclose on a piece of property. So

Resolved Question:

I am getting ready to foreclose on a piece of property. So if my trust deed is for $500,000 and over the past three years I have been paid $50,000, then I am still owed $450,000.

So when I foreclose, what would the amount be? $450,000 plus interest? (Because of interest income?) Will the IRS impute interest?
Submitted: 7 years ago.
Category: Tax
Expert:  William Ellis, CPA replied 7 years ago.
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William Ellis, CPA :

Good morning. You were supposed to charge interest at the FMV as of the date of the sale. If you had done this, most of the $50,000 would have been interest income to you. If you give me the specifics of the transaction such as the date of the transaction, the length of the installment and the amount of the payments, and the date of the planned foreclosure, I can tell you what your interest should have been. If you haven't been reporting interest, how have you been reporting the payments you've received? Thanks, Bill

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