Godlike Productions - Discussion Forum
Users Online Now: 2,600 (Who's On?)Visitors Today: 330,562
Pageviews Today: 686,329Threads Today: 244Posts Today: 4,764
10:24 AM


Rate this Thread

Absolute BS Crap Reasonable Nice Amazing
 

Help with Legal Advice Please! Bank Foreclosures going after owners for tax discrepancy in the value of original loan verses auction sale price.

 
Anonymous Coward
User ID: 73002415
United States
09/18/2016 09:35 AM
Report Abusive Post
Report Copyright Violation
Help with Legal Advice Please! Bank Foreclosures going after owners for tax discrepancy in the value of original loan verses auction sale price.
Please put aside all anti-Christ behavior and philosophy and see if you can offer sound advice.

I became aware recently of a dirty trick that banks are doing to homeowners: So lets say you bought an income property (not primary residence) in 2006 and paid $100,000 for it. Then the financial crisis hit, dropped the value of your investment property to like $45,000 but your monthly mortgage was still very high and you couldn't get the rent you needed to make the mortgage payments because low property values makes less renters.

So you were forced into a corner and decided to stop paying your mortgage on the income property in order to get yourself out of a horrible investment; Well the banks see what you did and even though the banks are the primary cause of the financial crisis, they can recommend your loan be investigated by the IRS. The IRS then taxes you on the difference from what your original loan was compared to the final auction/short sale price and hit you with the difference as taxable income. So if the investment house decreased in value by $55,000, you owe the IRS $55,000 x (depending on your tax bracket%) = a whole lot of cash.
Anonymous Coward
User ID: 72717525
09/18/2016 09:40 AM
Report Abusive Post
Report Copyright Violation
Re: Help with Legal Advice Please! Bank Foreclosures going after owners for tax discrepancy in the value of original loan verses auction sale price.
Debt forgiveness......in this case a "deficiency" between what you owe and what the short sale yielded is considered income and is taxable.

Lucky for you...form 710 waives taxes on deficiency judgements for this exact reason.

Your welcome.
Anonymous Coward (OP)
User ID: 73002415
United States
09/18/2016 09:50 AM
Report Abusive Post
Report Copyright Violation
Re: Help with Legal Advice Please! Bank Foreclosures going after owners for tax discrepancy in the value of original loan verses auction sale price.
Debt forgiveness......in this case a "deficiency" between what you owe and what the short sale yielded is considered income and is taxable.

Lucky for you...form 710 waives taxes on deficiency judgements for this exact reason.

Your welcome.
 Quoting: Anonymous Coward 72717525


thank YOu!!!
Anonymous Coward
User ID: 71059258
United States
09/18/2016 09:51 AM
Report Abusive Post
Report Copyright Violation
Re: Help with Legal Advice Please! Bank Foreclosures going after owners for tax discrepancy in the value of original loan verses auction sale price.
Yeah that happens - people need to ask the bank for "paid in fill" if they cooperate with the foreclosure

And by the way- if the bank forgives the debt left over- they send a 1099 to the IRS as it is TAXED as current INCOME
Anonymous Coward
User ID: 72975208
United States
09/18/2016 10:04 AM
Report Abusive Post
Report Copyright Violation
Re: Help with Legal Advice Please! Bank Foreclosures going after owners for tax discrepancy in the value of original loan verses auction sale price.
Shortsale is the answer to that.





GLP