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Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 12686
Experience:  Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
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Our home, with much equity, was foreclosed and sold at auction,

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Our home, with much equity, was foreclosed and sold at auction, receiving surplus funds from that sale. Additionally, we sued the financial institution for equity lost, and, settled for an amount 50% of our claim. Does this amount qualify for capital gains on the sale of our main home and the exclusion of $500,000 by the IRS?

Lane :

Hi, did you receive a 1099 for the settlement?

Lane :

If the amount received was more than your tax basis in the home (typically purchase price plus improvements) only then would it represent a gain

Customer:

Not yet this settled in Jan.2013. We filed W-9 with our attorney.

Lane :

Is the amount received more that what you had invested in the home?

Customer:

The amount is less. Thank you.

Lane :

:)

Lane :

Then no capital gain

Lane :

DId your attorney indicate that the settlement might be taxable?

Lane and 2 other Tax Specialists are ready to help you

Thanks much Lou.

Let me know if I can help further

Lane