Foreclosures Help Information

Posts Tagged ‘forgiveness’

Mortgage Foreclosure Relief Act Of 2007

Question: Countrywide Home Loans - Mortgage Forgiveness Debt Relief Act of 2007?

I am trying to complete my income taxes and I had a foreclosure in 2008. The Lender was Countrywide. I never received any paperwork from Countrywide stating the debt was forgiven. Does Countrywide report a 1099-C and why haven't I received a copy yet? Seeing as through Countrywide is the worse lender.... Does Countrywide even forgive the debt? The house is worth probably $50,000.00 and I owe then at least $125,000.00. That would mean I could be taxes on $75,000.00? Does the Mortgage Forgiveness Debt Relief Act 2007 discriminate against what type of loan, interest rate and income you had?

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Answer: Insolvency: If you are insolvent when the debt is cancelled, some or all of the cancelled debt may not be taxable to you. You are insolvent when your total debts are more than the fair market value of your total assets.

This is taken from the IRS publication

Insolvency: If you are insolvent when the debt is cancelled, some or all of the cancelled debt may not be taxable to you. You are insolvent when your total debts are more than the fair market value of your total assets.

http://www.irs.gov/individuals/article/0,,id=179414,00.html

You need to consult your Tax Adviser for this because if you are insolvent then you may or maynot have to pay taxes. For example in Debt Settlement The debt forgiven may or may not be taxible depending on if you are insolvent.

The IRS considers $600 or more of forgiven debt as taxable income.[citation needed] The forgiving creditor must provide the taxpayer with a 1099-C tax form. This form will list the amount of forgiven debt and interest in Box 2. Taxpayers with portions of personal loans forgiven may not subtract the interest reported in Box 3 from the amount of reportable income on this form.

However, the IRS does not require taxpayers to report forgiven debt if the tax payer was insolvent at the time the creditor forgave the debt. Being insolvent means that the amount of a debtor’s debts are greater than his/her assets (how much money and property the debtor owns). However, the IRS adds that “you cannot exclude any amount of canceled debt that is more than the amount by which you are insolvent.”[8]

For example, if a taxpayer is $10,000 in debt and owns $3,000 in assets, he/she cannot exclude more than $7,000 of forgiven debt from his/her income tax. Any forgiven debt over $7,000 that year must be reported as taxable income.

You Can't Short Sale

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Mortgage Foreclosure Debt Relief Act

Question: Will I be covered by the Mortgage Relief Act President Bush established?

I just completed a Deed In Lieu of Foreclosure and has debt forgiven. This was my primary residence and I had to relocate due to family medical issues. I know I will receive a 1099-C but From what I have read I will be able to have the debt forgiven based on this mortgage relief act. Just looking for some input or advice.
thanks
I thought you didnt have to pay any tax on debt forgiven if it was your primary residence

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Answer: You should be able to find some answers here:

http://www.irs.gov/individuals/article/0,,id=179414,00.html

National Anthem at Boston Tea Party! April 15, 2009

Mortgage Foreclosure Act

Question: will texas homestead protection help avoid foreclosure on my home?

I was several months behind on my mortgage. I am not sure of the foreclosure date, but I know that Welles Fargo sold my house out from under me on July 4th. Is there any way for me to keep my home? Will the Texas Homestead Act help me?

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Answer: the homestead act will not protect you from foreclosure. if they have already sold your home, you probably would have been evicted already. email me ler me see if i can get you some info on what is happening. [email protected]

Taxes on Short Sale, Loan Modification & Mortgage Foreclosure 5 Nov08 Mortgage Debt Relief Act