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    1099-c

    Client married and converted her personal residence into a rental property several years ago. She had trouble with loan company 1/7/2014 and they sent her a 1099-c which box 2 is $22472 and box 5 is marked and box 6 coded A - bankruptcy BUT still have the property and another loan company which have a 1098. Confused - still has property with another loan company making payment but another loan company sent a 1099-C . Do I adjust the basis by the $22742 - or what. Weird.

    Any thoughts

    #2
    is it possible that 1099C is for a home equity loan at different bank than mortgage loan.?

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      #3
      No

      It was her personal residence then converted it to rental in 2009 then in 2011 kicked them out and moved back to make it to personal. Then met a guy - moved in with him 2012 and converted it back to rental in 8/1/2012. Been rental since but maybe that is a good point with all the back and forth. But with her filing bankruptcy but has a new loan on it - now confused. Do I include it in her income as personal and show it as a bankruptcy on the 982.

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        #4
        I don't understand what's confusing you. It's entirely possible to have two loans secured by the same property. It's possible to have one of the loans discharged in bankruptcy and still own the property. It's possible to have both loans discharged in bankruptcy but only receive a 1099-C for one of them (typically because of poor practices by lenders around issuing 1099-Cs in a timely manner). It seems unusual to have one loan discharged and the other not, or to have both discharged and still make payments, but I wouldn't rule out any of those possibilities.

        So what precisely is the confusion or question?

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