1099-a?

[joek]

A co-worker of mine is in bk, this person knows i am so he asked what the receiving of a 1099-A meant. I told him i didnt know, but , i know some folks that can probably answer his question. When he filed bk, he gave up his home. He recieved a 1099-A form yesterday saying the property was valued at 184,000 and when he had owed 194,000. I ask him had he spoken to his attorney about it. He stated he has being trying to get in touch with him. So, can you folks give him a answer on what this means? lol I told him of this website, he said he doenst have a pc lol. I told him i would ask some of my bk forum experts what they thought of it.

[HHM]

1099-A is nothing you need to worry about. It is merely informational to tell the IRS that a transfer of ownership in a parcel of real estate took place.

Forgiveness of debt is reported on a 1099-C.

A 1099-A merely indicates that a taxable event potentially occurred.

[jdaniels1]

[worriedmom]

I'm in the same boat but haven't actually filed bk yet..anyone can answer?

[justbroke]

Will I have to report the balance as taxable income? The foreclosure of the property was a big factor in filing bankruptcy and I feel that I am still getting hit. Thanks.

Since your foreclosure (Abandonment) is on an investment property, it is business debt and subject to recapture taxes amongst other things. Plus, you are probably going to realize a gain as well.

I would consult a tax professional who understands -- and make sure you ask -- taxes related to 1099-A/Cs for residential "investment" (rental) properties so that they do the tax correctly! (If you go to H&R Block, make sure you go to their Business Tax Professionals and not the usual people sitting in the "Rapid Refund" offices. I did that once by mistake, but was lucky that a business tax specialist was there at the time and knew how to handle NOLs and the like!)