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How to Get Foreclosure Tax Relief

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					How to Get
Foreclosure
Tax Relief

                                                 Contents
If you borrow money from somebody and do
                                                 Introduction ..…………………………...1
not repay some or all of it, then the Internal
Revenue Service says that you received an        America Tax Laws………..……….…...2

income, and as we know, they tax all incomes     Form 1099-C…………………..………….2

too. This has undesirable side-effects for
                                                 Assets and Liabilities………………....2
those whose homes are foreclosed because
they also have to pay tax on the experience      Payment agreement…….………......3


too. This is not always necessary, though.
Here is how you might be able to avoid it.
                                                                                           2
American Tax Laws


American tax law says that when a debt forgiven in
foreclosure exceeds the fair market value (FMV) of the
mortgaged house, then the difference is income, and
therefore taxable. That is because the borrower “received” a
greater benefit than they would have if they had sold the
house themselves.




                                    Form 1099-C


                                    Your lender is obliged to provide you with a Form 1099-C on
                                    which the debt forgiven and the FMV both appear. If your
                                    home has already been auctioned, the FMV will be the sale
                                    price. If not, your lender may have indicated a higher estimate.
                                    This is one good reason not to let things like this drag on – if
                                    you are lucky, the estimated higher FMV could be to your tax
                                    advantage. In either case, determine whether the foreclosure
                                    resulted in a "taxable income” or not.




What’s does that mean?              Assets and Liabilities
For more terms and definitions,
check out ForeclosureDeals.com’s    You may offset any negative net worth against a “profit” on a
glossary page:
http://www.foreclosuredeals.com/G   foreclosure. This is easy to calculate too. Simply estimate the
lossary.php
                                    value of your total assets (car, television, clothes etc) and
                                    compare this with the total of your outstanding debt. If the
                                    result is a negative value, this can come off your “taxable
                                    foreclosure income” too, potentially helping you to manage
                                    your foreclosure tax obligations even more.
3                                            Payment Agreement

Foreclosure Deals

12550 Biscayne Blvd, Suite 306
                                             If your calculations fall to your advantage, contact the
Miami, FL 33181
FAX: 1-347-402-6620                          Internal Revenue Service right away. If you still owe
Contact@foreclosuredeals.com
                                             “foreclosure income tax”, that could be a good opportunity
If it’s not a deal, we won’t list it here!
                                             to negotiate a further reduction in your overall tax liability.
Find us on the Web:
http://www.ForeclosureDeals.com/

				
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posted:4/13/2011
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Description: If you wondering how to get foreclosure Tax relief, this presentation from ForeclosureDeals.com covers important options available for you. Watch it now and get them!