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Old 01-27-2012, 02:03 PM
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Surplus from a foreclosure three years prior

In 2007 ,i was forced to give up my home.In the ensuing foreclosure sale, there was a surplus of 4700 dollars.After three plus years of being jacked around by thecourt system,i recieved the money in 2011.There were no taxes taken out of this money.Do i claim this under miscellaneous income and do i need a 1099 form ton do so.I have not recieved one as of yet?Thank you for your time in this matter



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Old 01-28-2012, 08:40 AM
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“Do i claim this under miscellaneous income and do i need a 1099 form ton do so.I have not recieved one as of yet?”----> A foreclosure ends with a trustee's sale, where the highest bidder receives the property. The disbursement of funds from the sale pays off the mortgage. If any monies remain after paying the mortgage, then a mortgage foreclosure surplus exists. Finally, you who lost your property in a trustee's sale receive whatever money remains, I guess in this case $4,000. Assume the bank is owed $150K and the home sells for $200K. The county clerk ends up with the funds because the trustee can't keep the excess proceeds.The county is supposed to give the funds to the original owner after any other debts attached to the property are satisfied.In reality the owner doesn't even know the money is there.So, No, you can’t deduct the surplus( LTCG)of $4,700 on Sch A of 1040 as a misc. itemized deduction; you never paid any tax on the money,$4,700.$4,700 is not taxable income.



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Old 01-29-2012, 01:28 AM
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Im not trying to deduct it as a deduction.I just want to know if i have to claim it as income for this year



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