Jun

can i sell home as short sale and not get taxed on forgiven debt?

I lived in the home for 2 years and then rented it out for over a year now. Can I still claim this home as my principal residence so that if I sell as s short sale, I don’t have to pay taxes on forgiven debt?

How can you sale a house quick to get out of a really bad neighborhood? My parents have lived in a house for more than 23 years and the neighborhood has really went down south. I truly worry about their safety. What can be...
Is it possible to short sell a home loan when you have two loans with different company’s? i have a home loan with two company’s and want to short sell but i dont know if its possible with two loans and if i foreclose can the...
Has anyone purchase a short sell home or know the process of buying one? My fiancé and I put an offer on a short sell home and are waiting for the bank to accept our offer. I was wondering what are the step...
Can our 2nd mortgage company attach our wages once our home is sold as a short sale? Our 2nd mortgage company is suing us for $25,000 (the balance on our 2nd after they signed off the lien for the short sale). They have submitted paperwork to...
net worth is 1.1million including the prim.residence, and don’t need a big house, should I sell it or rent out Value of assets are 2/3 residence, and 1/3 securities. Earned Income is approx 30k per year. House needs minor interior work, i.e. paint, and deep cleaning to move to...

Categories : sell house

3 Comments

zeuz
July 1st, 2010 at 4:17 am

It can be your principal residence because you’ve lived in it for 2 of the last 5 years. Can the forgiven debt not be treated as income? — Only if you are insolvent at the time of the transaction. Talk to a CPA or an Enrolled Agent.

godged
July 3rd, 2010 at 8:45 am

Probably not. To get the debt forgiven, the property has to be your principal residence, and since you used it as investment property, you may be saddled with a 1099. Talk to a GOOD accountant that specializes in investor properties.

Janet P
July 3rd, 2010 at 4:22 pm

No, fraud is never a good choice. You need to pay taxes on both the rental income and the money you kept from the loan.