How is tax liability calculated from a 1099 a? – Money & Services

Report
Question

Please briefly explain why you feel this question should be reported .

Report Cancel

I received a 1099A from a foreclosure in 2009. Box 2 is$ 269,335.83. Box 4 is $308,265.26. Box 5 is checked yes. What is the liability or loss? No bankruptcy. Primary residence lived in less than 2 years.

Answer

They sent you the 1099A for informational purposes only. It seems that you gave your house to the bank in exchange for loan forgiveness of $269K (box 2). The fair market value of the home was $308K (box 4), so the bank came out ahead on this deal, and you have no tax consequences UNLESS the $269K is greater than your cost basis in the home. Unfortunately, if the $269K is less than your cost basis – you can not take a loss on it for tax purposes as your home is considered to be personal property, not an investment.

1
Money & Services 0 Answer 23 views 0

About the Author

Leave an answer

Captcha Click on image to update the captcha .

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>