1099-A and 1098 INT

[POCAHONTAS]

client received 1099-A fair market value is lower than the principal outstanding, the borrower is not liable for repayment of the debt, I have never come across this do I report this on form 982??

the same client also received a 1098 INT which is showing no interest but $12126 of real estate tax. the client says he never paid that. On the mortgage statement under escrow activity it shows
disbursements -12126
ending escrow balance -12126

so am I correct in assuming that the client cannot take the 12126 as a deduction on schedule A. And if not where should it be reported??

I am not familiar with 1099-A's so any help would be appreciated
thanks

[solomon]

A 1099-A is treated as a sale. Is this a qualifying residence?

[POCAHONTAS]

A 1099-A is treated as a sale. Is this a qualifying residence?

yes it is a qualifying residence

[solomon]

FMV is not relevant with non-recourse debt.

[peggysioux]

1099-a

I have the same scenario as Pocahontas with a client. Being the 1099-A is for a primary residence and there is no gain, does a schedule D need to be filed and just noted primary residence or no form needs to be filed?

[POCAHONTAS]

Hi peggy

were you able to find the answer to the situation?

[peggysioux]

1099-a

No definite answer. Maybe someone else will put in their thoughts if we keep bringing up to the top.

[S T]

Tax Book

Take a look at TTB page 14-10

There is a worksheet for foreclosures and repossessions and discussion of 1099A and 1099C

Where I have found 1099-A's to produce gain, is when the client had refinanced the property and taken out large amounts of equity and financed autos, paid of credit cards, etc. What does box 5 on the 1099A state

As in the Original post, I would recheck on the $12,126 figure for property tax or disbursement. What was the client's property tax deduction in 2006 or 2007??? Can you access your client's property tax assessor or collector (county) online, sometimes you can find the information going back a few years.

If client had the property taxes included in his monthly mortgage payment, then the lender would have had to pay those property taxes on behalf of the client, and they would be deductible on Schedule A, however, in your case I would try to verify. Maybe ask for an accounting on the Escrow Balance and the Disbursements? You are actually indicating that the account is at a negative (12,126)?

Sandy

[POCAHONTAS]

thank you so much sandy, I appreciate your time especially at this busy time

[POCAHONTAS]

so even if the 1099-A produced a gain doesn't the "mortgage forgiveness debt relief act of 2007 apply" in this case