Questions from homeowners on my site
Daniel in Maricopa County asked "If the foreclosure sale price is less than what is owed on the property/mortgage will the IRS come after me for taxes on the difference? I owe 2 mil on my mortgage what if the difference is 1 mil? I couldn\'t afford the taxes what could I do?"
I know in the past when I did short sales, I would request to eliminate or reduce the tax implication for the sale and it would help in some instances. In today's market I do not think lenders are willing to negotiate I think they just automatically send the 1099 on the same day the short sale funds. The answer is yes, if there is a one million dollar discount there will be a 1099 generated.
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