Trying to get some answers for a 1099-A. The rental property has a cost & depreciation basis at $43,000 - depreciation - $14622. A 1099-A of line 2 principal outstanding is $27,381 where line 4 - FMV of property is $20,400. Box yes is marked for repaiment of the debt.
A Judgement entered the court where the plaintiff bid the amount of $17,979 but the client redeemed for the sum of $18,235 where the plantiff was entitled to the $18235.
So the reporting of it 4797 - I am showing FMV is the lesser of the two is the "sales price" which is the $20,400 and the adj basis is the 28619. So if correct I should have a 8219 loss but what I am not understanding is the the difference between the FMV & note since I do believe the lender forgives the amount cause the client said had to let it go back...so the difference is the 6981 deb forgiveness income - where does that report under....have not filed bankruptcy yet...any help especially if wrong is needed.
Thanks
A Judgement entered the court where the plaintiff bid the amount of $17,979 but the client redeemed for the sum of $18,235 where the plantiff was entitled to the $18235.
So the reporting of it 4797 - I am showing FMV is the lesser of the two is the "sales price" which is the $20,400 and the adj basis is the 28619. So if correct I should have a 8219 loss but what I am not understanding is the the difference between the FMV & note since I do believe the lender forgives the amount cause the client said had to let it go back...so the difference is the 6981 deb forgiveness income - where does that report under....have not filed bankruptcy yet...any help especially if wrong is needed.
Thanks
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