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Barbara
Barbara, Enrolled Agent
Category: Tax
Satisfied Customers: 3792
Experience:  20+ years of experience in tax preparation; 30+ years of experience as a real estate/corporate paralegal.
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When I filed my 2012 taxes I had a short sale and a second

Customer Question

when I filed my 2012 taxes I had a short sale and a second mortgage, the second was written off in the amount of $162,000 called debt discharged and the short sale had a debt discharged of 100,000 do I have to pay taxes on a gain of $262,000
Submitted: 1 year ago.
Category: Tax
Expert:  Barbara replied 1 year ago.
Welcome to Just Answer. My name is ***** ***** I will be happy to assist you.Did you receive 1099-C's for the canceled mortgages? Was this on your primary residence?Best regards,Barb
Customer: replied 1 year ago.
I did received a 1099C and it was my primary residence.
Customer: replied 1 year ago.
I did received a 1099C form.
Expert:  Barbara replied 1 year ago.
Thank you for the additional information.Because the 1099-C is for your primary residence, you can exclude any gain by using Form 982. The Mortgage Debt Relief Act provides for an exclusion of up to $250,000 (filing single)/$500,000 (filing married filing jointly).https://www.irs.gov/uac/Home-Foreclosure-and-Debt-Cancellationhttps://turbotax.intuit.com/tax-tools/tax-tips/Home-Ownership/How-to-Avoid-Taxes-on-Canceled-Mortgage-Debt/INF12033.htmlPlease let me know if I can assist you further.Thank you and best regards,Barb