If you are considering a real estate short sale of your home, you should be aware that you might receive a form 1099-C for the amount of the lender's losses.
This is considered loan forgiveness in the eyes of the IRS. If you have other assets such as savings and you are not insolvent, you may end up being responsible to pay ordinary taxes on the amount of the 1099-C.
If you settle a debt with a creditor for less than the full amount owed, you may be required to report this forgiven debt as regular income, with certain important exceptions.
The forgiven debts include money owed after foreclosure or property repossession or credit accounts that you don't pay.
There are exceptions noted below:
If a lender forgives or writes off $600 or more of a debt's principal (the amount not including interest or fees) must send you and the IRS a Form 1099-C at the end of the year. When you file your tax return for the tax year in which your debt was written off, the IRS will require that you report the amount on the form as income.
Fortunately, the Obama administration passed a law stating that if you are short selling your primary residence, you may be exempt from paying taxes even if a 1099 is submitted to the IRS by the lender.
While you may not have received this form from the creditor, the creditor may have submitted one to the IRS anyway. If you don’t list the income on your tax return and the IRS has the information of the transaction on file, you could get a tax bill or, worse, an audit notice. This could end up costing you more than just the original tax bill.
There are several exceptions stated in the Internal Revenue Code. For example, you do not have to report the income on your tax return if the write off of the debt is intended as a gift, you discharge the debt in bankruptcy, or you were insolvent before the creditor agreed to settle or write off the debt. You should consult a qualified tax and legal counsel to see if these circumstances apply.
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8 Eagleview Drive
Moncks Corner, SC 29461
Foxbank Plantation
Residential
MLS# 23023045 / Active
INCENTIVE!!! (TIED TO PREFERRED LENDER / ATTORNEY) SPEND $35,000 IN UPGRADED OPTIONS: RECEIVE $20,000 OFF & $5K IN CLOSING COSTS. PLUS THROUGH END ...
6 Eagleview Drive
Moncks Corner, SC 29461
Foxbank Plantation
Residential
MLS# 23023044 / Active
INCENTIVE!!! (TIED TO PREFERRED LENDER / ATTORNEY) SPEND $35,000 IN UPGRADED OPTIONS: RECEIVE $20,000 OFF & $5K IN CLOSING COSTS. PLUS THROUGH END ...
4 Eagleview Drive
Moncks Corner, SC 29461
Foxbank Plantation
Residential
MLS# 23023042 / Active
INCENTIVE!!! (TIED TO PREFERRED LENDER / ATTORNEY) SPEND $35,000 IN UPGRADED OPTIONS: RECEIVE $20,000 OFF & $5K IN CLOSING COSTS. PLUS THROUGH END ...
7 Eagleview Drive
Moncks Corner, SC 29461
Foxbank Plantation
Residential
MLS# 23023041 / Active
INCENTIVE!!! (TIED TO PREFERRED LENDER / ATTORNEY) SPEND $35,000 IN UPGRADED OPTIONS: RECEIVE $20,000 OFF & $5K IN CLOSING COSTS. PLUS THROUGH END ...
5 Eagleview Drive
Moncks Corner, SC 29461
Foxbank Plantation
Residential
MLS# 23023040 / Active
INCENTIVE!!! (TIED TO PREFERRED LENDER / ATTORNEY) SPEND $35,000 IN UPGRADED OPTIONS: RECEIVE $20,000 OFF & $5K IN CLOSING COSTS. PLUS THROUGH END ...
3 Eagleview Drive
Moncks Corner, SC 29461
Foxbank Plantation
Residential
MLS# 23023039 / Active
INCENTIVE!!! (TIED TO PREFERRED LENDER / ATTORNEY) SPEND $35,000 IN UPGRADED OPTIONS: RECEIVE $20,000 OFF & $5K IN CLOSING COSTS. PLUS THROUGH END ...
303 Elizabeth Street
Walterboro, SC 29488
Varn
Residential
MLS# 23023029 / Active
Welcome home to this adorable Cottage with a possible THREE bedrooms, on a beautiful CORNER LOT. Enter into a spacious living room with a FIREPLACE...
Increase +$10,000
130 River Landing Drive UNIT #7212
Charleston, SC 29492
Daniels Landing
Residential
MLS# 23023028 / Active
**Unit 7212 will remain open during reno** Beautiful 1 bed 1 bath condo in Daniel's Landing located on the Wando River. Outstanding Daniel Island l...
Reduced -$5,900
2 Eagleview Drive
Moncks Corner, SC 29461
Foxbank Plantation
Residential
MLS# 23023021 / Active
INCENTIVE!!! (TIED TO PREFERRED LENDER / ATTORNEY) SPEND $35,000 IN UPGRADED OPTIONS: RECEIVE $20,000 OFF & $5K IN CLOSING COSTS. PLUS THROUGH END ...
7 Opal Wing Street
Moncks Corner, SC 29461
Foxbank Plantation
Residential
MLS# 23023019 / Active
INCENTIVE!!! (TIED TO PREFERRED LENDER / ATTORNEY) SPEND $35,000 IN UPGRADED OPTIONS: RECEIVE $20,000 OFF & $5K IN CLOSING COSTS. PLUS THROUGH END ...
Increase +$1,500
6 Opal Wing Street
Moncks Corner, SC 29461
Foxbank Plantation
Residential
MLS# 23023017 / Active
INCENTIVE!!! (TIED TO PREFERRED LENDER / ATTORNEY) SPEND $35,000 IN UPGRADED OPTIONS: RECEIVE $20,000 OFF & $5K IN CLOSING COSTS. PLUS THROUGH END ...
Increase +$1,000
5 Opal Wing Street
Moncks Corner, SC 29461
Foxbank Plantation
Residential
MLS# 23023016 / Active
INCENTIVE!!! (TIED TO PREFERRED LENDER / ATTORNEY) SPEND $35,000 IN UPGRADED OPTIONS: RECEIVE $20,000 OFF & $5K IN CLOSING COSTS. PLUS THROUGH END ...
Increase +$1,500
4 Opal Wing Street
Moncks Corner, SC 29461
Foxbank Plantation
Residential
MLS# 23023015 / Active
INCENTIVE!!! (TIED TO PREFERRED LENDER / ATTORNEY) SPEND $35,000 IN UPGRADED OPTIONS: RECEIVE $20,000 OFF & $5K IN CLOSING COSTS. PLUS THROUGH END ...
Increase +$1,500
3 Opal Wing Street
Moncks Corner, SC 29461
Foxbank Plantation
Residential
MLS# 23023014 / Active
INCENTIVE!!! (TIED TO PREFERRED LENDER / ATTORNEY) SPEND $35,000 IN UPGRADED OPTIONS: RECEIVE $20,000 OFF & $5K IN CLOSING COSTS. PLUS THROUGH END ...
Increase +$1,500
2 Opal Wing Street
Moncks Corner, SC 29461
Foxbank Plantation
Residential
MLS# 23023012 / Active
INCENTIVE!!! (TIED TO PREFERRED LENDER / ATTORNEY) SPEND $35,000 IN UPGRADED OPTIONS: RECEIVE $20,000 OFF & $5K IN CLOSING COSTS. PLUS THROUGH END ...
Increase +$1,500
1 Opal Wing Street
Moncks Corner, SC 29461
Foxbank Plantation
Residential
MLS# 23023008 / Active
INCENTIVE!!! (TIED TO PREFERRED LENDER / ATTORNEY) SPEND $35,000 IN UPGRADED OPTIONS: RECEIVE $20,000 OFF & $5K IN CLOSING COSTS. PLUS THROUGH END ...
Increase +$1,500
14 Opal Wing Street
Moncks Corner, SC 29461
Foxbank Plantation
Residential
MLS# 23023006 / Active
INCENTIVE!!! (TIED TO PREFERRED LENDER / ATTORNEY) SPEND $35,000 IN UPGRADED OPTIONS: RECEIVE $20,000 OFF & $5K IN CLOSING COSTS. PLUS THROUGH END ...
Increase +$1,500
13 Opal Wing Street
Moncks Corner, SC 29461
Foxbank Plantation
Residential
MLS# 23023005 / Active
INCENTIVE!!! (TIED TO PREFERRED LENDER / ATTORNEY) SPEND $35,000 IN UPGRADED OPTIONS: RECEIVE $20,000 OFF & $5K IN CLOSING COSTS. PLUS THROUGH END ...
Increase +$1,500
12 Opal Wing Street
Moncks Corner, SC 29461
Foxbank Plantation
Residential
MLS# 23023002 / Active
INCENTIVE!!! (TIED TO PREFERRED LENDER / ATTORNEY) SPEND $35,000 IN UPGRADED OPTIONS: RECEIVE $20,000 OFF & $5K IN CLOSING COSTS. PLUS THROUGH END ...
Increase +$1,500
11 Opal Wing Street
Moncks Corner, SC 29461
Foxbank Plantation
Residential
MLS# 23023001 / Active
INCENTIVE!!! (TIED TO PREFERRED LENDER / ATTORNEY) SPEND $35,000 IN UPGRADED OPTIONS: RECEIVE $20,000 OFF & $5K IN CLOSING COSTS. PLUS THROUGH END ...
Increase +$1,500
9 Opal Wing Street
Moncks Corner, SC 29461
Foxbank Plantation
Residential
MLS# 23023000 / Active
INCENTIVE!!! (TIED TO PREFERRED LENDER / ATTORNEY) SPEND $35,000 IN UPGRADED OPTIONS: RECEIVE $20,000 OFF & $5K IN CLOSING COSTS. PLUS THROUGH END ...
Increase +$1,500
The data relating to real estate for sale on this web site comes in part from the Broker ReciprocitySM Program of the Charleston Trident Multiple Listing Service. Real estate listings held by brokerage firms other than EXP Realty LLC are marked with the Broker ReciprocitySM logo or the Broker ReciprocitySM thumbnail logo (a little black house) and detailed information about them includes the name of the listing brokers. Last updated on 05-09-2024 11:54 PM EST .
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