A quick question about Form 982.
Taxpayer's foreclosed former primary residence had two loans forgiven. One is the mortgage loan which was for the purchase of the principal residence. The other one is an equity loan.
I think the first loan is excluded on Form 982 because it is a qualified principal residence indebtedness. But the second loan cannot be excluded because taxpayer had used the equity loan proceed for personal purpose.
However, taxpayer can exclude part of the second loan due to insolvency.
Therefore, the total excluded amount is composed of two categories. One is due to the principal residence indebtedness and the other is due to insolvency.
My question: On Form 982, do we put the total of the excluded amount from both categories on line 2? Or are we supposed to file two different Form 982, one for the principal residence indebtedness exclusion and the other one for the insolvency exclusion?
Thank you.
Taxpayer's foreclosed former primary residence had two loans forgiven. One is the mortgage loan which was for the purchase of the principal residence. The other one is an equity loan.
I think the first loan is excluded on Form 982 because it is a qualified principal residence indebtedness. But the second loan cannot be excluded because taxpayer had used the equity loan proceed for personal purpose.
However, taxpayer can exclude part of the second loan due to insolvency.
Therefore, the total excluded amount is composed of two categories. One is due to the principal residence indebtedness and the other is due to insolvency.
My question: On Form 982, do we put the total of the excluded amount from both categories on line 2? Or are we supposed to file two different Form 982, one for the principal residence indebtedness exclusion and the other one for the insolvency exclusion?
Thank you.
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