September 15, 2009

More RVs

Filed under: Debt Settlement,Short Sale

This is a RV. The bank told us to short sale it. We sell it for less and we get a 1099 from them to report on our taxes. Is this correct?

My husband lost his job and we no longer can afford the payments. The bank will not lower the interest rate.

So it is either give it back or short sale!!

Tenna

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Hi Tenna,

That is correct.  Forgiveness of debt is generally treated as income; however, look at IRS form 982 and see if the insolvency exclusion can remove or reduce any tax burden.

Also, give me some info on the RV and maybe I’ll buy it.

Thanks for the questions and hope this helps.

Paul

This author is not a tax advisor and this information should not be considered tax advice.  Please consult a qualified tax advisor for tax advice.

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