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short sale and 982 ?

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    short sale and 982 ?

    This was a short sale.
    2 loans discharged first and second.
    Took two loans to purchase house. All acqusition debt.
    Do I combine both discharges and put total on 982.

    And finally, They did have a refi in order to lower interest rate. Did not take any money out. Is the closing expense for the refi concidered acquisition debt also or do I have to pull that amount out and put it on 1040 line 21 (not the points the other costs)?
    This was a $1,200,000 home.

    #2
    Originally posted by ljwalters View Post
    This was a short sale.
    2 loans discharged first and second.
    Took two loans to purchase house. All acqusition debt.
    Do I combine both discharges and put total on 982.

    And finally, They did have a refi in order to lower interest rate. Did not take any money out. Is the closing expense for the refi concidered acquisition debt also or do I have to pull that amount out and put it on 1040 line 21 (not the points the other costs)?
    This was a $1,200,000 home.
    Acquisition debt is acquisition debt - it can go on the 982. However, the refi would need an adjustment even if they didn't take any money out. The cost of the refi would come out. and I would ask to examine that closing statement. They may well have paid off other loans, credit cards, etc and still think they didn't take any money out.
    See instructions for 982 where it says the refi can be taken only on balance before the refi:
    JG

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