How Will Foreclosing on My House Change My Taxes?
Roseville Foreclosure Lawyers
When a mortgage company forgives part of your debt in a foreclosure or short sale, that forgiven debt can be considered phantom income by the IRS. Even though you received no money, you received value. Before you sign any mortgage documents, talk to a Roseville bankruptcy attorney about your circumstances to ensure you don't make a decision you regret.
Contact us at (916) 675-3866 for a bankruptcy consultation with an attorney.
How Can I Get the IRS to Leave Me Alone? Should I Short Sell My House?
The IRS will not go away. Relief of debt will be documented by a form 1099C — a notice that you received monetary value. You could owe taxes on that value.
Short sales can create a tax liability.
Homeowners who owe more on their mortgage than their home is worth (also called being 'underwater') may choose to short sell their home, avoiding foreclosure in exchange for a tax obligation and a lower selling price. Is a short sale worth the tax obligation? Talk to your attorney to find out.
Short sales can also generate paper profits on which you will be required to pay taxes. What seemed like a good deal to avoid home foreclosure can become a tax pitfall in many cases. Contact an experienced lawyer who knows how to evaluate your options from every angle — including the tax angle.
Know the tax implications before you make a foreclosure decision.
Before you decide to make a decision such as short-selling your home, you should speak with an experienced foreclosure lawyer. At Cecil Cianci Law, PC, our Roseville foreclosure attorneys will give you a personal consultation to discuss your options. Contact us online or via phone at (916) 675-3866 to schedule your consultation.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.
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