| “I have not received a 1099c, only the 1099a. How do i proceed to file my 2011 tax return with this 1099a.”----> The difference between the box 2,$174K, and box 4 , $246K, amounts is not your taxable income or gain on the foreclosure. STATE law determines whether the amount in box 2 or the amount in box 4 is used as your selling price, and your gain or loss is computed with respect to your cost basis in the property. By itself, Form 1099-A reports only half the information you need to report the foreclosure on your tax return. Under the rules for calculating the tax consequences of a foreclosure, you will need to report the foreclosure just like it was a sale of the property. The outstanding loan balance is found in Box 2, $174K; the property's fair market value is found in Box 4, $246K. The date of the foreclosure is indicated in Box 1, and this will be used as the date the property was disposed of (that is, the "sale date").As box 5 is NOT checked , you loan is nonrecourse loan meaning you are NOT personally liable for repayment of the debt. As long as your selling price, $175K, is larger than its basis, you need to report it on Sch D/Form 8949. The difference between the selling price and your cost basis will result in your gain or loss. Gains are taxable, losses personal residences are not tax-deductible.Gain or loss is reported on Sch D/Form 8949 for homes that were personal residences. As a reminder, the IRS does not allow people to claim a loss on personal residences. Any long term capital gain on personal residence can be offset by the capital gains exclusion for a main home; Individuals can exclude up to $250K in profit from the sale of a main home (or $500K for a married couple) as long as you have owned the home and lived in the home for a minimum of two years. Those two years do not need to be consecutive. In the 5 years prior to the sale of the house, you need to have lived in the house for at least 24 months in that 5-year period.
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