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Old 04-08-2014, 10:00 PM
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I received a 1099A on property that was included in Ch 7 Bankruptcy

I filed Ch 7 Bankruptcy in 2011 and included my primary residence. All debts were discharged in 2011. The property was foreclosed on in 2013. I received a for 1099A showing FMV higher than principal balance. I thought that filing Ch 7 would have prevented owing taxes on a foreclosed property that was included in the bankruptcy. What should I do?


Last edited by kfly : 04-08-2014 at 10:35 PM. Reason: more detail


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Old 04-09-2014, 08:45 AM
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Quote:
Originally Posted by kfly View Post
I filed Ch 7 Bankruptcy in 2011 and included my primary residence. All debts were discharged in 2011. The property was foreclosed on in 2013. I received a for 1099A showing FMV higher than principal balance. I thought that filing Ch 7 would have prevented owing taxes on a foreclosed property that was included in the bankruptcy. What should I do?
as the fmv is higher than the balance of principal, the money is in place to fully settle the debt. you will therefore not acquire any tax liabilities from the repossession and sale process.1099A asks for the FMV, which can be a reasonable estimate of what the property would fetch in its current condition. With real estate the figure used here is usually the amount the lender received by selling the property at a foreclosure sale



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